The stock market was hovering near highs Wednesday as global inflation concerns remain, while in the U.S. investors are eagerly expecting news of who will be nominated to lead the Federal Reserve.
Futures for the Dow Jones Industrial Average indicated an open 10 points lower, after the index climbed 54 points Tuesday to close at 36,142. Futures for the S&P 500 —which remains just shy of its record high—signaled a similar start, with the Nasdaq on pace to open higher.
Inflation concerns remain front and center, though better-than-expected U.S. retail sales figures Thursday provided a break from inflationary fears as investors cheered signs of a strong economy and the resilience of the U.S. consumer.
“Central banks are heavily in focus on Wednesday as we get a bunch of inflation data from across the globe and hear from a number of policy makers whose views on the trend will set the tone for the markets,” said Craig Erlam, an analyst at broker Oanda.
“Stock markets have been struggling to build on a strong earnings season recently as inflation and interest rates have topped the list of investors concerns over the coming months. Given how long that list has become and the other risks on it, that’s saying something,” Erlam added.
Economic data in the day ahead include building permits and housing starts for October, while Fed Governor Michelle Bowman and a number of Fed presidents are due to speak.
“Markets are still awaiting some concrete news on who might be nominated as the next Fed Chair,” noted Jim Reid, a strategist at Deutsche Bank . Current Fed Chair Jerome Powell remains the favorite for renomination, as per betting odds, but Fed Governor Lael Brainard is viewed as another possible pick to lead the central bank.
“President Biden did say to reporters that an announcement would be coming ‘in about four days,’ so investors will be paying close attention to any announcements,” Reid added.
Overseas, Tokyo’s Nikkei 225 declined 0.4%. The FTSE 100 fell 0.4% in London, underperforming other European indexes after U.K. consumer-price index data showed year-over-year inflation at 4.2%—above both expectations and the Bank of England’s target. The high inflation print raised the prospect of an interest-rate increase soon, strengthening the pound and hitting shares in U.K. multinationals that do business in foreign currencies.
Here are four stocks on the move Wednesday
U.K. enterprise software group Sage (ticker: SGE.U.K.) jumped 4.7% in London despite posting a 10% drop in operating profit as its cloud business squeezed margins. But the company said its cloud business had grown 19% so far this year.
Siemens Healthineers (SHL.Germany) surged 5.6% in Frankfurt, after the health-technology company set upbeat revenue and earnings targets for fiscal years 2023 to 2025. The company expects revenue growth of 6% to 8% annually.
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