U.S. stock-index futures edged lower Tuesday, with investor attention settling on employment data coming at the end of the week, though major benchmarks remained on track to close out August with gains.
What are major indexes doing?
- Futures on the Dow Jones Industrial Average YM00, -0.08% fell 48 points, or 0.1%, to 35,304.
- S&P 500 futures ES00, -0.09% were off 7.45 points, or 0.2%, at 4,517.75.
- Nasdaq-100 futures NQ00, -0.11% declined 29.75 points, or 0.2%, to 15,567.75.
The Dow DJIA, -0.16% fell 55 points on Monday to close at 35,399, while the S&P 500 SPX, +0.43% booked its 53rd record close of 2021 and the Nasdaq Composite COMP, +0.90% also finished at an all-time high. The S&P 500 was on track to end the first eight months of the year with its strongest year-to-date gain since 1997.
For the month, the Dow was up 1.3% through Monday’s close, while the S&P 500 was 3% higher, the Nasdaq was up 4% and the small-cap Russell 2000 RUT, -0.49% was holding a 1.8% gain.
What’s driving the market?
Investor attention is on U.S. jobs data coming at the end of the week, analysts noted. 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 indexes (PMI) data from China caused stocks to wobble. The manufacturing PMI slightly underperformed but remained in expansionary mode at 50.1, but the 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 was 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.
Which companies are in focus?
- Shares of Zoom Video Communications Inc. ZM, +1.96% tumbled nearly 13% in premarket trade after the videoconferencing company delivered a tepid third-quarter outlook late Monday, though it second-quarter results topped expectations.
- Robinhood Markets Inc. HOOD, -6.89% shares were down more than 3% after Securities and Exchange Commission Chairman Gary Gensler told Barron’s on Monday that a ban on payment for order flow “is on the table.” Payment for order flow is a practice where market makers pay brokers to execute their orders. Critics contend it carries a conflict of interest that’s detrimental to individual investors.
- Shares of Designer Brands Inc. DBI, -2.47% jumped after the parent of DSW delivered results that blew past second-quarter earnings forecasts.
What are other markets doing?
- The yield on the 10-year Treasury note TMUBMUSD10Y, 1.293% rose 0.9 basis point to 1.291%. Yields and debt prices move in opposite directions.
- The ICE U.S. Dollar Index DXY, -0.21%, a measure of the currency against a basket of six major rivals, was down 0.2%.
- Oil futures traded lower as Gulf Coast refineries struggled to reopen following Hurricane Ida, with the U.S. benchmark CL00, -1.08% down 0.9% at $68.61 a barrel. Gold futures GC00, +0.01% edged higher, up 0.2% at $1,815.20 an ounce.
- In Europe, the FTSE 100 UK:UKX was down 0.5%, while the pan-European Stoxx 600 XX:SXXP fell 0.3%.
- Asian stocks managed to eke out gains, with Tokyo’s Nikkei 225 NIK, +1.08% rising 1.1% as the Hong Kong Hang Seng Index HSI, +1.33% ticked up 1.3% and the Shanghai Composite SHCOMP, +0.45% edged 0.5% higher