Stock futures rise after retail sales unexpectedly increased

Stock futures rose Friday morning to reverse losses from the previous day, with traders digesting a new consumer spending report that came in stronger than expected for June.

Contracts on the S&P 500 moved up. The Dow and Nasdaq also indicated higher opens.

This week, along with an early series of earnings results for the second quarter, investors picked up a ton of new economic data. On the economic side, the data is mixed, with major consumer and producer price increases rising the most in decades as supply chain constraints and labor shortages weigh in. However, Friday’s Department of Commerce report on retail sales showed a surprising pickup on the demand side of the economy. US retail sales rose 0.6% in June compared to the previous month and reversed course after falling 1.7% in May.

Still, Federal Reserve Chairman Jerome Powell suggested before Congress on Wednesday and Thursday that, given the labor market and other areas of inflation, it was too early for the central bank to step in and reverse ultra-accommodative monetary policy to avoid the Curb inflation The economy has yet to recover more fully from the pandemic.

“We continue to believe that too many people are focusing on inflation … it’s the predominant topic that we have looked at and spoken to our customers [about]”Brian Belski, BMO Capital Markets’ chief investment strategist, told Yahoo Finance. And I don’t think that’s going to go away anytime soon.”

Meanwhile, corporate earnings results infiltrated from large financial firms are also mixed. Banks like Bank of America (BAC), JPMorgan Chase (JPM), and Morgan Stanley (MS) beat consensus estimates on quarterly sales and earnings, but also showed signs of slowing under the hood growth in core businesses as credit demand and trading fixed income was weaker than expected.

Overall, however, expectations for the second-quarter earnings season remain high as Wall Street has consensus that aggregate S&P 500 earnings per share should increase more than 60% year over year. The influx of earnings reporters over the next week, including some big names like Netflix (NFLX) and Johnson & Johnson (JNJ), will give a more complete picture of how American companies are doing as more parts of the spring and early summer reopen Economy have developed.

The story goes on

“I think we could see another quarter of the beats by the time we get back to a Q4 where it’s a little harder to compare,” Josh Wein, portfolio manager at Hennessy Funds, told Yahoo Finance. “In the fourth quarter of 2020, things started to open up again. And so I think we’re just seeing these beautiful beats and increases. I would guess it will return to Earth in the fourth quarter and certainly the first quarter. “

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8:32 am ET: Retail sales rose unexpectedly in June

Retail sales jumped surprisingly in June after falling in May, the Commerce Department said on Friday in a print that underscored a still strong demand side of the economy during the recovery.

Retail sales in the United States increased 0.6% in June compared to the previous month. Consensus economists expected a monthly decline of 0.3%, according to Bloomberg data.

Retail sales fell 1.7% in May. This has been revised down from a previously reported 1.3% decline.

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7:32 am ET Friday: Stock futures gain ahead of retail sales

Here were the key moves in the markets as of 7:32 a.m. ET:

• S&P 500 futures (ES = F): +6.25 points (+0.14%) to 4,358.25

• Dow futures (YM = F): +38 (+ 0.11%) to 34,902.00

• Nasdaq Futures (NQ = F): +25 (+ 0.17%) to 14,812.5

• Raw (CL = F): + $ 71.70 (+ 0.07%) to $ 71.70 per barrel

• Gold (GC = F): $ -12.90 (-0.71%) to $ 1,816.10 per ounce

• 10-year treasury (^ TNX): + 2.2 bps to generate 1.319%

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6:06 p.m. ET Thursday: Stock futures dip

Here the markets were traded on Thursday evening

• S&P 500 futures (ES = F): 4,348.00, -4 points (-0.09%)

• Dow futures (YM = F): 34,835.00, -29 points (-0.08%)

• Nasdaq Futures (NQ = F): 14,777.00, -10.5 points (-0.07%)

NEW YORK, NY – JUNE 02: Exterior view of the New York Stock Exchange and Wall Street as the new company Organon begins trading next Thursday in New York on June 02, 2021. Organon plans to expand to offer treatments for other conditions that are only applicable to women. About 80% of the new company’s revenues will be generated outside of the US (Photo by Kena Betancur / VIEWpress)

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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

source https://thedailytradingnews.com/stock-futures-rise-after-retail-sales-unexpectedly-increased/