S&P 500 futures rose 0.4% early Monday as technology stocks led U.S. equities higher after the July 4th break. The gains come ahead of Wednesday's release of Federal Reserve minutes, which investors will scan for signals on whether the central bank's next move is a rate hike.
U.S. stock futures pointed higher early Monday, with the technology sector leading the advance as markets reopened after the long holiday weekend. S&P 500 futures were rising 0.4% and Nasdaq 100 futures were gaining 1.0%, while Dow Jones Industrial Average futures were up 41 points, or 0.1%.
The move followed a holiday-shortened week in which all three indexes ended higher. The Dow closed Thursday at an all-time high, its 20th record close of the year, even as the S&P 500 and Nasdaq Composite dipped that session.
Fed minutes headline a light data week
Corporate news is set to dominate a week thin on economic releases, the exception being Wednesday's Federal Reserve minutes from the June policy meeting. That meeting was the first chaired by Kevin Warsh, who succeeded Jerome Powell in late May. Warsh reiterated the Fed's 2% inflation target, which Wall Street read as hawkish.
One drag on tech stocks has been concern that the Fed could deliver a rate hike. According to Barron's, ING analyst Chris Turner wrote in a research note: "some (or many) members could see the Fed's next move as a rate hike." The yield on the benchmark 10-year Treasury note stood at 4.461% early Monday, ticking down from the previous week.
Chips and oil in focus
Attention will stay on the semiconductor sector, with the Invesco PHLX Semiconductor ETF down 11.4% so far in July. South Korea's SK Hynix, the world's second-largest memory chip maker, hopes to raise more than $29 billion by issuing American depositary receipts on the Nasdaq this week.
One inflation concern that should be easing is oil prices. OPEC+ said it would raise output by about 188,000 barrels a day in August, following a virtual meeting on Sunday, with actual flows depending on the reopening of the Strait of Hormuz. West Texas Intermediate futures traded below $69 a barrel early Monday.
Source: Barron's
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