As implied by the current U.S major index futures, Monday's opening stock market is expected to be relatively steady, following the upward trend witnessed over the recent trading sessions. The strong performance on Wall Street that positioned the S&P 500 to a record close above 5,000 may lead traders to slow down and reflect. The tech-oriented Nasdaq has also shown substantial progress, inching closer to the record highs set in November 2021.
A lack of significant U.S economic data might lead some traders to adopt a wait-and-see stance ahead of several important reports expected to be released in the upcoming days. Key among these is the report on consumer price inflation for January from the Labor Department coming out on Tuesday. This report is expected to significantly influence the outlook for interest rates. Also anticipated are reports on retail sales, industrial production, producer price inflation, and consumer sentiment later in the week.
Driven by success in technology stocks, the stock market saw generally positive movement during Friday's trading session. Major averages showed a continued upward trend with the S&P 500 closing above 5,000 for the first time. Notable was the Nasdaq's substantial gain, soaring 196.95 points or 1.3 percent to 15,990.66. Despite a modest pullback by Disney (DIS), the narrower Dow also edged upwards, albeit slightly.
The moderate revision to consumer price growth in December, as reported by the Labor Department, largely influenced the upward trajectory on Wall Street. The revised data indicated a 0.2 percent increase in the consumer price index in December, down from the previously reported 0.3 percent. Boosted by a jolt to tech stocks, the core consumer prices, which exclude food and energy prices, remained at a constant increase of 0.3 percent.
Among sector-specific stocks, semiconductor stocks extended their rally over two sessions, boosting the Philadelphia Semiconductor Index by 2.0 percent. Both computer hardware and software stocks showed considerable strength, with the NYSE Arca Computer Hardware Index and the Dow Jones U.S. Software Index rising by 1.8 percent and 1.4 percent, respectively.
In terms of individual stocks, Bitcoin miner CleanSpark (CLSK) reported an unexpected fiscal first-quarter profit on better-than-expected revenues, pushing its shares upwards by 32.9 percent. Shares of Cloudflare (NET) also registered a 19.5 percent increase after the cloud services provider posted fourth quarter results beating expectations and providing optimistic guidance. Meanwhile, Pinterest (PINS) saw their shares fall by 9.5 percent following a weaker than expected fourth quarter revenue report and a disappointing guidance.
In the commodity and currency market, Crude oil futures are falling to $76.07 a barrel after previously climbing to $76.84. Meanwhile, gold futures fell to $2,038.70 an ounce in the previous session and is now further decreasing to $2,037.90. The U.S dollar is currently trading at 149.12 yen, slightly lower than Friday's closing at 149.29 yen. However, the dollar is modestly lower against the euro, trading at $1.0766 compared to last Friday's $1.0784.
Most Asian stock markets closed lower despite the S&P 500's record-setting close on Friday. This was largely due to thin holiday trading resulting from the Lunar New Year celebrations. Investors are keenly watching for the release of U.S consumer price inflation data for January, Japanese's last quarter GDP figures for 2023, and speeches from several Federal Reserve officials for hints on economic and monetary policy outlook. Notably, the Australian market declined after CSL, a pharmaceutical company, reported a failed phase 3 trial for a heart attack drug, causing its shares to slump by 4.8 percent. As a result, the benchmark S&P/ASX 200 Index dropped 0.4 percent to 7,614.90, and the broader All Ordinaries Index closed 0.3 percent lower at 7,860.30.ANZ Group Holdings, a lending institution, saw an increase of 1.3% while electronics dealer JB Hi-Fi recorded a remarkable 7.1% rise after revealing impressive earnings. On the other hand, New Zealand's key indicator, the S&P/NZX-50 Index, dropped 0.9% to 11,757.97, with market participants awaiting Wednesday's release of Fletcher Building's half-yearly returns.
In India, the Sensex experienced a 0.7 percent slump to 71,072.49, as public sector banks and media shares faced sales pressures.
In Europe, most stocks experienced a rise on Monday, setting the stage for a week filled with earnings reports, economic data publications, and speeches by Federal Reserve representatives. Investors are eagerly awaiting Tuesday's release of U.S. inflation data for January, which offers vital insights into the Federal Reserve's rate path, especially in light of dwindling enthusiasm for early Fed rate reductions.
Germany's DAX Index and France's CAC 40 Index are both up 0.4%, while the U.K.'s FTSE 100 has declined slightly by 0.1% as traders look forward to the release of pertinent U.K. GDP and inflation estimates this week.
In other notable movements, Novo Nordisk shares are gaining following rumors that its primary shareholder aims to invest up to $7 billion annually by 2030. Tod's SpA's shares have also enjoyed a boost after LVMH-backed L Catterton declared its intention to purchase a 36% share in the Italian luxury brand. Nordex SE is another company excelling in the market, as it exceeded its projected revenues by reporting preliminary consolidated sales of 6.5 billion euros for the fiscal year 2023.
On a sour note, GSK shares dipped in spite of the U.S. Food and Drug Administration's Fast Track designation for its hepatitis B drug, bepirovirsen. Tritax Big Box REIT also experienced a downturn after arranging to buy U.K. Commercial Property REIT Ltd in exchange for 0.444 new ordinary BBOX shares per UKCM share.
In the U.S., Neel Kashkari, the President of the Minneapolis Federal Reserve, is set to engage in an Economic Club of Minnesota discussion at 1 pm ET.
Looking at specific stocks, Teva Pharmaceutical is expected to perform well in the pre-market due to an upgrade from Neutral to Overweight by Piper Sandler. Urban Outfitters may also see an uptick after UBS improved its stock rating from Sell to Neutral.
Conversely, Big Lot's pre-market trading sees a dip following a downgrade from Hold to Sell by Loop Capital. Barclays also downgraded its rating on electric vehicle maker Rivian Automotive, which may adversely affect the company's performance.