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Stocks mark higher ahead of PCE . inflation data


U.S. stock futures rose slightly on Friday morning after an intense sell-off as investors awaited a flurry of economic reports and looked ahead to the long holiday weekend.

Futures contracts tied to the S&P 500 (^GSPC) rose 0.1%, while futures on the Dow Jones Industrial Average (^DJI) added 65 points, or 0.2%. Contracts on the tech-heavy Nasdaq Composite (^IXIC) is also a modest 0.1% higher.

The US stock and bond markets will be closed on Monday, December 26, to celebrate Christmas Day. The bond market will close an hour earlier than usual on Friday, at 2 p.m. ET.

PCE Price Index — index The Fed’s Preferred Inflation Measure — is set to release at 8:30 a.m. ET. Investors will also receive readings on personal spending, the latest University of Michigan Consumer Sentiment Survey, and data on new home sales.

On a monthly basis, PCE is expected to grow 0.1% in November, down slightly from 0.3% last month, Bloomberg consensus estimates show. PCE inflation may slow to 5.5% from 6% earlier in the year.

Core PCE, which excludes volatile food and energy components, is set to grow 0.2% month-over-month — unchanged from October — and a slightly slower 4.7% increase over the same period. year, down from 5% of the previous month.

After the Fed final policy decision of 2022 Last week, strategists pointed out that the most surprising data point among economic projections from officials was the upward revision of their core PCE expectations to 3.5% from 3.1. % before the end of 2023. This suggests to many that the Federal Reserve will need to keep fees at their last high level through 2023.

“We expect the Fed to revise its forecasts as soon as March, although progress will be slow initially; policymakers appear to have been swayed by the experience of the past year and a half and will want to be sure that Ian Shepherdson, chief economist at Pantheon Macroeconomics, said in a note.

NEW YORK, NEW YORK - DECEMBER 21: People walk past the New York Stock Exchange during afternoon trading December 21, 2022 in New York City.  Stocks closed sharply higher today for a second straight day with the Dow Jones Industrial Average closing more than 500 points amid a better-than-expected report on consumer confidence from the Conference Board.  (Photo by Michael M. Santiago/Getty Images)

NEW YORK, NEW YORK – DECEMBER 21: People walk past the New York Stock Exchange during afternoon trading. (Photo by Michael M. Santiago/Getty Images)

Friday’s moves come after an earlier brutal trading day that saw the S&P, Dow and Nasdaq record losses of 1.4%, 1% and 2.2%, respectively. Investors were spooked by warnings from chipmaker Micron Technology about the semiconductor industry and a strong labor market, as well as consumer spending data that confirmed the outlook for “higher” interest rates. for a longer period of time”.

Oil prices rise on Friday and head for big weekly gains as investors expect Russia’s crude oil supply falls. That helped quell concerns about a drop in transportation fuel demand in the US ahead of a winter storm heading towards North America. West Texas Intermediate (WTI) crude oil futures – the US benchmark – rose 2% to $79 a barrel.

Yields on US Treasuries inched higher, while the US dollar index fell against a basket of other currencies.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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