Nasdaq, S&P 500 Futures Keep Head Above Water Ahead Of Fed Speeches: Analyst Says Market-Boosting Themes 'Firmly In Place'

U.S. index futures are modestly higher in early trading on Monday, suggesting that the upward momentum remains intact, albeit laced with caution. Traders will likely scan speeches by Federal Reserve officials for confirmation regarding rate trajectory. The global markets have taken development in the Middle East in their stride, underlining their resilience. The week will be all about Nvidia Corp.‘s NVDA earnings. Although looking for a beat, an analyst says either way, the AI stalwart’s earnings report could give a boost to the market.

Cues From Previous Week

The April inflation print along with some weak economic data reinforced expectations concerning rate cuts, sending bond yields lower. Tamer inflation data released mid-week provided the spark, sending averages into record territory. Stocks gave back some of the gains over the remainder of the week and yet closed notably higher. More importantly, the 30-stock Dow Jones Industrial Average closed above the 40,000 psychological resistance for the first time ever on Friday.

The Dow extended its winning streak to five straight weeks, while the Nasdaq Composite and the S&P 500 are up for four weeks on the trot.

Fund manager Louis Navellier is positive about the near-term market outlook. “As earnings season winds down the longer-term themes are reasserting themselves, AI and tech, the election year, inflation, the Fed, and consumer spending,” he said. The fund manager expects the Fed to cut rates irrespective of whether inflation recoiled below the central bank target of 2%.

“Overall, the themes that have driven the market to new highs remain in place and should keep the positive momentum going, albeit likely at a slower pace, barring any Black Swan event,” Navellier said.

He termed Nvidia earnings, due after the close on Wednesday, as the “grand finale for the first quarter announcement season.”  He expressed comfort at the AI stalwart’s valuation. “Although Nvidia has posted 11.4% to 29.2% earnings surprises in the past four quarters, the stock is priced for perfection and trades at 31.8 times forecasted 2026 earnings,” he said.

Upcoming Economic Data:

The unfolding week is a Fed-heavy one, with a slew of speeches by central bank officials and the minutes of the May Federal Open Market Committee on tap. Traders also get to digest the April durable goods orders report, the customary weekly jobless claims data, the flash S&P Global manufacturing and services sector purchasing managers’ indices for May, the University of Michigan’s final consumer sentiment index for May, and April existing and new home sales data.

Among the Fed speeches scheduled for the day are:

• Fed Vice Chair for Supervision Michael Barr and Fed Governor Christopher Waller: 9 a.m. EDT
• Fed Vice Chair Philip Jefferson: 10:30 a.m. EDT

The Treasury is set to auction three- and six-month notes at 11:30 a.m. EDT.

See Also: How To Trade Futures

Stocks In Focus:

• Li Auto Inc. LI fell about 4.40% in premarket trading following its quarterly results announcement, while Wix.com Ltd. WIX Jumped over 7.50% on earnings.
• Those reporting after the market close include Nordson Corporation NDSN, Palo Alto Networks, Inc. PANW, Trip.com Group Limited TCOM and Zoom Video Communications, Inc. ZM.

Commodities, Bonds, and Global Equity Markets:

Crude oil futures slipped modestly, while gold futures rallied amid the geopolitical tensions engendered by the mishap in which Iranian President Ebrahim Raisi was killed. Rumors of potential foul play in the chopper crash have given rise to fears that the Middle East tensions may escalate. A troy ounce of gold traded above $2,440.

Ten-year U.S. Treasury note yield is marginally weaker, although holding above the 4.4% level. Bitcoin BTC/USD was little changed around the $67K level.

Major equity markets in Asia closed higher, although the Indian market was closed on account of national elections, while European stocks have started on a firm note.

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