S&P 500 futures nudged up Friday morning as traders braced for a pivotal inflation report closely monitored by the Federal Reserve.
The futures tied to the broad market index rose 0.24%, while Nasdaq 100 futures climbed 0.43%.
Dow Jones Industrial Average futures remained relatively flat.
In after-hours trading, Ulta Beauty took a hit, dropping 7% after falling short of both revenue and profit expectations for the second quarter.
In contrast, Lululemon Athletica gained 4% on stronger-than-expected earnings, and Dell Technologies saw a 3% boost, thanks to robust server sales that drove better-than-anticipated fiscal second-quarter results.
The week has been marked by volatile trading, with Nvidia’s quarterly performance dampening the mood on Thursday.
The tech giant, a leader in the AI sector, saw its shares slip, which dragged down the S&P 500 and the Nasdaq Composite.
However, the Dow Jones bucked the trend, adding over 240 points to close at a new record high.
All eyes now turn to the upcoming personal consumption expenditures (PCE) price index, due at 8:30 a.m. ET.
Economists surveyed by Dow Jones expect a 0.2% rise in headline prices for July, translating to a 2.5% annual increase.
The core PCE, a crucial metric for the Fed, is also projected to climb 0.2% month-over-month, with a 2.7% annual gain, up slightly from the previous 2.6%.
This data could prove to be a key influencer as the Fed weighs its next move on interest rates in September.
LPL Financial’s chief global strategist Quincy Krosby noted that “the market is poised to digest the PCE results, with expectations leaning towards a slight uptick in the core year-over-year figure.”
Krosby added that because some Fed members are suggesting they need more data to confirm that inflation is continuing on a downward path before agreeing to cut rates, “any surprise indicating a hotter report could be negative for the market.”
As August draws to a close, the S&P 500 is on track for a modest 1.3% gain, with the Dow trailing closely at 1.2%.
The Nasdaq Composite, however, is the odd one out, down nearly 0.5% for the month.
Looking at the weekly performance, both the S&P 500 and Nasdaq are headed for losses of 0.8% and 2%, respectively, marking the first losing week in three for these indexes.
The Dow, on the other hand, is set to notch its third consecutive positive week, up 0.4%.
The market’s fate hinges on the upcoming inflation data, as traders navigate the fine line between optimism and caution, waiting to see if the Fed’s next move will fan the flames or cool the jets.
In this climate, business leaders are keeping a close eye on economic indicators, knowing that these numbers will shape strategies for the months ahead.
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