Dow futures down 100 points, pressured by Boeing, Fed trajectory

U.S. stock futures indicated a cautious session on Wall Street Monday morning, after a plunge in Boeing shares and amid uncertainty over Federal Reserve policy.

How are stock-index futures trading

  • Futures on the Dow Jones Industrial Average
    fell 108 points, or 0.3%, to 37,611.

  • S&P 500 futures
    were up 3.75 points, or 0.1%, at 4,738.50.

  • Nasdaq-100 futures
    rose 33.25 points, or 0.2%, to 16,493.50.

On Friday, the Dow
S&P 500

and the Nasdaq Composite

snapped a streak of nine straight weekly gains.

What’s driving markets

U.S. stocks were in line for a muted open Monday, with the Dow under particular pressure as shares in Boeing
fell more than 6% in premarket action after some of its 737 Max 9 planes were grounded following the blowout of a fuselage panel.

Sentiment was further dampened by a sharp fall in China stocks — the Hang Seng in Hong Kong HK:HSI lost 1.9% to flirt with its lowest levels since November 2022 — as concerns about draconian regulation and the health of the world’s second-biggest economy lingered.

The fresh caution comes after equity investors last week took profits and benchmark bond yields moved back above 4% as the market pared back expectations for Federal Reserve interest rate cuts.

Friday’s stronger-than-expected reading on the U.S. labor market coupled with a weaker-than-forecast survey of the services sector encapsulated the uncertainty over the trajectory of Fed policy.

“Taken together, a resilient economy and as yet unfinished business with inflation are likely to result in the Federal Reserve staying put on interest rates for the time being, as opposed to the early March cut which markets has been anticipating,” said Richard Hunter, head of markets at Interactive Investor

Indeed, recent comments from the central bank’s officials suggest they are trying to discourage the market from getting too hopeful that borrowing costs will be swiftly reduced this year.

Speaking on Saturday, Dallas Fed President Lorie Logan said it was too early to take rate increases off the table as inflation remained above the 2% target and “a premature easing of financial conditions could allow demand to pick back up.”

See: Why stock-market investors will remain at mercy of shifting rate-cut expectations after wobbly start to 2024

Her peer Raphael Bostic, president of the Atlanta Fed, is due to make comments at noon Eastern. And on Thursday the December consumer prices index will be published, where economists expect headline annual inflation to be 3.3%, up from November’s 3.1%.

Otherwise, it’s a thin start to the week for economic data, with the New York Fed’s survey of consumer expectations released at 11 a.m. Monday, and the consumer-credit data for November released at 3 p.m.

Ahead of that, the…

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