U.S. stock market futures were pointing to a positive start on Tuesday, with investor attention settling on employment data coming at the end of the week. Meanwhile, in Asia, stocks wobbled after weak Chinese data revealed the impact of Covid-19 restrictions and regulatory crackdowns.
What are U.S. future indicating?
Dow industrials futures
were pointing up around 70 points;
S&P 500 futures
indicated an open less than 0.2% higher;
Nasdaq 100 futures
suggested the tech-heavy index would open 0.3% into the green.
What’s driving markets?
Analysts noted that investor attention is on U.S. jobs data coming at the end of the week. The August jobs report on Friday will give markets their next major chance to estimate when and how the Federal Reserve will begin slowing pandemic-era measures to add liquidity to markets.
“This will be in focus after [Fed chair] Powell’s speech at Jackson Hole, where he said that there had been ‘clear progress toward maximum employment,’ and that he was in favor of beginning to taper the Fed’s asset purchases this year,” said Henry Allen, an analyst at Deutsche Bank.
“In terms of what to expect, our U.S. economists think that the pace of hiring will slow somewhat after the strong report in July, but the +700,000 increase in nonfarm payrolls that they’re forecasting should be more than sufficient to keep the Fed on track to announce tapering at the November Federal Open Market Committee meeting,” Allen added.
In Asia, markets spent much of the day in the red after weak manufacturing and non-manufacturing purchasing managers’ index (PMI) data from China caused stocks to wobble. Manufacturing PMI slightly underperformed but remained in expansionary mode at 50.1, but non-manufacturing PMI surprised in a tumble from 53.3 to 47.5 this month.
“Covid-19 lockdowns in various cities and critical ports sapped domestic consumption, and consumers postponed travel as a result,” said Jeffrey Halley, an analyst at broker OANDA.
“However, it is likely that the ongoing government clampdowns in multiple sectors, notably student tuition and technology, are impacting both employment concerns in those affected and broader consumer confidence as fears of wider interventions rise,” Halley added.
The focus in Europe falls on the Eurozone flash consumer price index for August, which rose 3% year-over-year, above the 2.8% expected.
U.S. economic data on the table Tuesday include the Case-Shiller national home price index for June, as well as the Chicago PMI for August and the consumer confidence index for this month.
It’s a light day on the corporate earnings front, with NetEase, CrowdStrike, H&R Block reporting results.
Asian stocks managed to eke out gains, with Tokyo’s Nikkei 225
rising 1.1% as the Hong Kong Hang Seng Index
ticked up 1.3% and the Shanghai Composite
edged 0.5% higher
In Europe, the FTSE 100
was down 0.1%, while the pan-European Stoxx 600
rose 0.2%; Paris’ CAC 40
was up 0.2% and Frankfurt’s DAX
moved 0.6% into the green
- The price of aluminum traded on the London Metal Exchange hit its highest point since May 2011, with three-month aluminum touching $2,726.50 a metric ton before settling around $2,655.50. The surge—on track for a seventh straight month of gains—comes amid output cuts in China due to tight controls on power usage.