S&P 500 futures rose 0.1% and Nasdaq futures climbed 0.3% after Federal Reserve Governor Christopher Waller said recent data show signs of disinflation, easing bets on a rate hike this month. Asian shares tracked the move higher ahead of the U.S. August payrolls report.
Waller's disinflation comments cool rate-hike bets
Speaking at a Reuters NEXT Newsmaker event, Waller said recent data suggested some signs of disinflation and that he would favor holding rates steady at this month's policy meeting if upcoming reports reinforce that trend. As a result, futures traders scaled back the chance of a rate hike this month to 50%, down from about 63% a day earlier.
Those hike expectations had surged in recent sessions as a global bond rout drove long-dated yields to multi-year highs, fueled by concerns over stubborn inflation, swelling government debt and geopolitical tensions. Analysts at JPMorgan said Waller's remarks push back against the case, made by Warsh last week, that underlying inflation has yet to move lower.
S&P 500 futures gain as Asian shares track Wall Street higher
European stocks were braced for a higher open, with a pan-region index up 0.1%. S&P 500 futures rose 0.1% and Nasdaq futures climbed 0.3%, tracking Wall Street's advance.
In Asia, MSCI's broadest index of Asia-Pacific shares outside Japan rose 1.5% to offset earlier losses. Japan's Nikkei gained 1.4% but was still down 1.9% for the week, while Chinese blue-chips rose 4% and South Korea's KOSPI increased 2%. Software stocks jumped on Wall Street after a bullish forecast from Snowflake, which sent its shares up 16.6%.
Payrolls report looms after weak prior month
Traders are bracing for the U.S. payrolls report for August due later in the day, though Waller said he did not expect the data to deviate much from the current trend of a stable labor market. Forecasts are centered on a rise of 56,000 jobs after a shock fall of 23,000 the previous month, with the unemployment rate expected to hold steady at 4.1%.
Overnight data also showed U.S. services-sector activity picked up pace last month, with a measure of prices paid jumping to a three-year high, while the Fed's Beige Book survey showed economic activity edged up in recent weeks.
Source: Investing.com
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