S&P 500 and Nasdaq 100: Stocks Rise as Markets Brace for Key Inflation Data

U.S. Equity Futures Rise Ahead of Crucial Inflation Data

U.S. equity futures edged higher on Monday as investors turned their focus to critical inflation reports expected this week. This cautious optimism follows last week’s volatility, where markets nearly recovered from sharp sell-offs driven by concerns over a potential economic slowdown.

At 12:22 GMT, Dow Futures are trading 39708.00, up 68.00 or +0.17%. S&P 500 Index futures are at 5384.25, up 14.00 or +0.26% and Nasdaq 100 Index Futures are trading 18671.75, up 55.75 or +0.30%.

Key Pre-Market Movers

Several stocks made significant moves in premarket trading:

• KeyCorp surged 18% after announcing a minority investment from The Bank of Nova Scotia. Scotiabank’s acquisition of 14.9% of KeyCorp’s common stock for approximately $2.8 billion in cash provided a strong boost to the regional bank’s shares.
• Starbucks added 2.2% following news that activist investor Starboard Value had taken a stake in the company, aiming to enhance its stock performance. The Wall Street Journal reported that Starboard’s involvement could lead to strategic changes aimed at boosting shareholder value.
• Eli Lilly saw a 1.4% rise after Deutsche Bank upgraded the pharmaceutical giant to a “buy” rating from “hold,” citing the company’s strong earnings performance and its position as a “low beta/high growth” stock.

• JetBlue Airways dropped nearly 6% after the airline announced plans to issue $400 million in convertible senior notes due in 2029, raising concerns about potential dilution.
• Hawaiian Electric Industries fell by nearly 10% following the company’s disclosure of a $1.30 billion net loss for the second quarter, largely due to a goodwill impairment charge. The company also indicated it does not yet have a financing plan for a $1.71 billion settlement related to the Maui wildfires.

Focus on Inflation Data

Investors are bracing for key economic data this week, with the producer price index (PPI) on Tuesday and the consumer price index (CPI) on Wednesday being closely watched. These reports are expected to provide critical insights into inflation trends and will likely influence the Federal Reserve’s next steps. July retail sales data, due on Thursday, will further clarify consumer spending patterns, an important indicator of economic health.

Callie Cox, chief market strategist at Ritholtz Wealth Management, highlighted the market’s nervousness, noting that, “Investors have jumped to conclusions about the economy, and now they’re going to analyze a fresh batch of data to judge how warranted this sell-off actually is.” She also pointed out that strong inflation data could ease fears and support further market rallies, particularly in sectors sensitive to interest rates.

Market Outlook

With the upcoming inflation data and earnings reports from key companies like Home Depot and Cisco, market volatility could persist. Investors will need to weigh the new economic data against the backdrop of recent market swings to gauge the likelihood of continued recovery or renewed pressure on stocks.

Technical Analysis

E-mini S&P 500 Index futures are edging higher shortly before Monday’s opening. The key level to watch is the pivot at 5360.50.

A sustained move over 5360.50 will indicate the presence of buyers. If this creates enough upside momentum the look for a near-term surge into the 50-day moving average at 5503.75.

The inability to hold 5360.50 will signal the presence of sellers. This could trigger a near-term break into 5239.75.