Federal Reserve Governor Christopher Waller said late Thursday that the central bank should cut the Fed funds rate now, but suggested that he would rely on incoming data to decide the pace and magnitude of future rate reductions.
U.S. stock futures were on the back foot early Friday as the market’s record run infused some caution among investors. Tech earnings released after the market closed on Thursday were mixed, with Marvell Technology, Inc.’s (MRVL) earnings intensifying concerns about a potential slowdown in artificial intelligence (AI)-related demand.
The market may also focus on the personal consumption expenditure index data that will shed more light on pricing.
Federal Reserve Governor Christopher Waller said late Thursday the central bank should cut the Fed funds rate now but suggested that he would rely on incoming data to decide the pace and magnitude of future rate reductions.
As of 4:20 a.m. ET on Friday, the Nasdaq 100 slumped 0.44%, the Dow futures and the S&P 500 futures slipped 0.30% each, and the Russell 2000 Index moved down 0.28%.
Stocks advanced for a third day on Thursday, with the S&P 500 Index and the Dow Jones Industrials Average finishing at fresh records. The S&P 500 topped the 6,500 level for the first time.
Communication services, energy, and IT stocks led the gains, while the defensive sectors, such as healthcare, consumer staples, and real estate stocks, declined during the session.
The SPDR S&P 500 ETF (SPY), an exchange-traded fund (ETF) that tracks the S&P 500 Index, gained 0.35%, and the Invesco QQQ Trust (QQQ) rose 0.63%. Meanwhile, the SPDR Dow Jones Industrial Average ETF Trust (DIA) and the iShares Russell 2000 ETF (IWM) advanced 0.17% and 0.12%, respectively.
In Friday’s session, the spotlight is likely to be on the personal income and spending report, a consumer confidence reading and a regional manufacturing reading for August, as well as the earnings report from Alibaba (BABA).
“The AI theme remains intact,” said fund manager Louis Navellier. His comments followed the earnings reports from Nvidia (NVDA) and Marvell, which showed a slowdown in demand for their chips designed to power data centers.
“Overall, we are now in a brave new world where our standard of living is increasingly dependent on AI, enhancing productivity to boost GDP growth, Navellier said. “These productivity gains help reduce inflationary pressures resulting from a stronger U.S. dollar.”
Both crude oil and gold futures edged lower early Friday following their recent strength. The 10-year U.S. Treasury note yield is stuck at depressed levels. The dollar traded narrowly mixed.
Asian stocks showed listlessness after their recent gains as domestic traders await the U.S. inflation data.
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