U.S. stock futures were mixed on Monday, but remained largely subdued, as investors awaited the release of crucial inflation data later in the week.
At 06:55 ET (10:55 GMT), the Dow futures contract was up 65 points or 0.19%, while S&P 500 futures traded 6 points or 0.13% higher, and tech-heavy Nasdaq 100 futures dipped by 9 points or 0.07%.
The spotlight is now turning to U.S. consumer price index inflation data, due out on Wednesday. The reading is expected to show that while inflation eased slightly in April, it still remained well above the Federal Reserve’s 2% annual target range.
The evolution of price growth last month could give investors further clues about the Fed’s monetary policy plans. The U.S. central bank raised borrowing costs by 25 basis points last week, but hinted that this would be the peak of its year-long aggressive tightening cycle by removing from its accompanying statement the phrase that it “anticipates” more hikes.
Complicating the Fed’s task was a stronger-than-expected April jobs report that showed unemployment dipping and wages ticking higher on a monthly basis. Analysts at ING noted that the wage growth “will keep some of the more hawkish Federal Open Market Committee members nervous about inflation pressures emanating from the labor market.”
Markets are largely pricing in the possibility that U.S. interest rates have peaked, with Fed Fund futures prices pointing to a 90% probability that the Fed will hold rates in June.
Meanwhile, traders may receive more cues on the recent turmoil in the U.S. banking sector when a Fed survey of U.S. loan activity is unveiled later in the day.
Stocks are coming off of a volatile week marked by persistent concerns around the health of midsize U.S. lenders, although signs of a nascent recovery in these stocks have begun to emerge.
Shares in PacWest (NASDAQ:PACW) jumped in premarket trading, extending gains registered on Friday, after the Beverly Hills-based bank cut its dividend and said its business is “solid.” Arizona-based peer Western Alliance (NYSE:WAL) also rallied by just over 9%, adding on to an increase of nearly 50% to end the prior session.
Elsewhere, cryptocurrency-exposed businesses Marathon Digital (NASDAQ:MARA) and Riot Platforms (NASDAQ:RIOT) dropped. The moves come after digital coin exchange Binance lifted a block on Bitcoin withdrawals that were caused by heavy volumes and a spike in processing fees.
Occidental Petroleum (NYSE:OXY) dipped slightly after Warren Buffett said Berkshire Hathaway will not make a bid to take full control of the energy firm.
On the earnings calendar, payments group PayPal Holdings (NASDAQ:PYPL) highlights the latest batch of corporate reports out today.
Oil prices gained Monday as hopes grew that the U.S., the world’s top crude importer, may be able to avoid a recession even though the April jobs report could persuade the Fed to keep rates higher for longer.
By 06:55 ET, U.S. crude futures moved up by 2.41% to $73.06 a barrel, and the Brent contract climbed 2.22% to $76.97 per barrel.
Additionally, gold futures edged 0.34% higher to $2,031.75/oz, while EUR/USD was 0.27% in the green at 1.1047.
