U.S. index futures showed little movement in pre-market trading this Friday. Investors are focused on the Federal Reserve’s meeting on September 17-18, which is expected to result in a 25 basis point interest rate cut.
At 5:16 AM, Dow Jones futures (DOWI:DJI) rose 51 points, or 0.12%. S&P 500 futures gained 0.18%, and Nasdaq-100 futures advanced 0.09%. The 10-year Treasury yield was at 3.638%.
On today’s U.S. economic calendar, at 8:30 AM, the August import price index will be released, expected to fall 0.3%, contrasting with a 0.1% increase the previous month. The import price index excluding fuel will also be published, following a previous rise of 0.1%. At 10 AM, the preliminary reading of the September consumer sentiment index will be released, expected at 68.5, up from the previous 67.9.
In commodities, oil prices rose on Friday following production disruptions in the Gulf of Mexico caused by Hurricane Francine. If these gains hold, it would break a streak of weekly losses. However, demand outlook remains weak, particularly in China and the U.S., which may limit price recovery.
West Texas Intermediate crude for October rose 0.94% to $69.62 per barrel, while Brent for November climbed 0.76% to $72.52 per barrel.
Gold (PM:XAUUSD) hit a record, reaching an intraday high of $2,570.62 per ounce on Friday, extending weekly gains. The precious metal’s rise accompanies a weaker dollar and expectations of Federal Reserve interest rate cuts. Gold benefits from economic uncertainty and a search for financial safety. At the time of writing, gold was up 0.42%, at $2,568.66.
Asia-Pacific markets showed mixed results on Friday. China’s CSI 300 dropped 0.42%, reaching its lowest level since 2019. Australia’s S&P/ASX 200 gained 0.3% but failed to hold its all-time high. South Korea’s Kospi rose 0.13%, while Japan’s Nikkei 225 fell 0.68%. The Kosdaq gained 0.3%, despite a decline in Samsung Electronics (KOSPI:005930) shares due to a five-day strike at its factory in India. Hong Kong’s Hang Seng rose 0.81% in the final hour of trading.
In India, August inflation rose to 3.65% year-over-year, exceeding the revised 3.6% from July and the 3.5% forecast, marking the highest increase in five years.
According to a Reuters poll, Japan’s consumer inflation likely rose 2.8% in August, above the central bank’s 2% target. Exports grew 10%, but lagged behind imports, resulting in a trade deficit. Future data will provide more details on these indicators and the overall economy.
Economists expect the Bank of Japan to keep interest rates unchanged at the next meeting, but anticipate a hike by year-end. While the BOJ has been slow to act, most believe an adjustment will come in December or October, continuing its gradual tightening trend.
European markets are trading in positive territory, with sectors like automobiles and construction standing out with gains. In contrast, shares of Worldline (EU:WLN) plunged 17.5% due to the CEO’s departure and reduced growth forecasts. With no corporate earnings in sight, investors await inflation data from France.
On Thursday, the European Central Bank cut the deposit rate by 25 basis points to 3.50% and indicated future rate cuts. Inflation remains below the 2% target, and the Eurozone economy is weakening. Further cuts may be delayed until the next meeting unless the economic situation worsens.
On Thursday, the Nasdaq and S&P 500 rose for the fourth consecutive day. The Dow Jones advanced 235.06 points (0.58%) to 41,096.77, while the S&P 500 gained 41.63 points (0.75%) and the Nasdaq rose 174.15 points (1.00%).
The rally was driven by optimism around interest rates despite mixed inflation data. The PPI increased 0.2% in August, above the 0.1% forecast, and the annual rate slowed to 1.7%. The NYSE Arca Gold Bugs index surged 5.8% on the day, and shares of Netgear (NASDAQ:NTGR) jumped 30.8% after a revenue revision.