Stock Futures Volatile as Inflation Data Roll In

Consumer spending fell, while PCE inflation rose to its highest level since 1983

Managing Editor
Jan 28, 2022 at 9:19 AM
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Stock futures are limping into the weekend, a feature of 2022 thus far. Dow Jones Industrial Average (DJI) futures were last seen more than 100 points below fair value, brushing off an outstanding record-setting earnings report from Apple (AAPL). S&P 500 Index (SPX) futures are stuck in neutral, while Nasdaq-100 Index (NDX) futures are cautiously higher, as investors unpack consumer spending that fell 0.6% in December, slimmer than the expected 0.7% decline. Elsewhere, the Fed's favored inflation gauge, the core Personal Consumption Expenditures (PCE) prices index, rose to 4.9% year-over-year, its highest level since 1983.

Continue reading for more on today's market, including:  

  • Is it time to buy the dip on this mining stock?
  • Netflix stock took a step forward yesterday.
  • Plus, tech stock battered; and two Dow staples in the earnings confessional.   

OV Futures Jan 28

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw 1.5 million call contracts traded on Thursday, and 1,037,462 put contracts. The single-session equity put/call ratio climbed to 0.70, and the 21-day moving average rose to 0.52.
  2. Western Digital Corp (NASDAQ:WDC) stock is 9.4% lower in electronic trading, after the tech company reported a weaker-than-expected guidance for the third quarter, which overshadowed a top-line beat for the second quarter. Supply chain issues were cited as a factor, prompting five analysts to trim their price targets this morning, the worst coming from Barclays to $60 from $65. Year-to-date, WDC is off by 17.4% heading into today.
  3. Visa Inc (NYSE:V) stock is 4.8% higher before the bell, trying to prop up the Dow after the credit card giant reported earnings and revenue that topped analyst expectations. Travel spending and e-commerce were cited as catalysts, while seven analysts have responded with price-target hikes, the loftiest coming from Evercore to $312 to $308. Visa stock has shed 16.8% in the last six months.
  4. The shares of Chevron Corporation (NYSE:CVX) are off by 2.9% ahead of the open, after the energy giant's earnings fell short of estimates. Revenue did top estimates, though, thanks to higher oil and gas prices. CVX is up 15.3% in 2022 heading into today.
  5. It's a banner day for economic data. Due out are reports on real disposable income, real consumer spending, personal income, and the employment cost index. The University of Michigan will release its consumer sentiment index and five-year inflation expectations.
buzz jan 28

Volatility Spreads to Overseas Markets

Asian markets were mixed to wrap up the week, as investors digested more volatility on Wall Street following the U.S. Federal Reserve’s comments, a gross domestic product (GDP) reading, and a batch of corporate earnings reports. Leading the gainers was Japan’s Nikkei with a 2.1% pop, after SoftBank Group said CEO Marcelo Claure is leaving the company, while South Korea’s Kospi enjoyed a 1.9% pop amid strength in the tech sector. Meanwhile, Hong Kong’s Hang Seng and China’s Shanghai Composite fell 1.1% and 1%, respectively.

Stateside volatility is also weighing on European markets, which were last seen sharply lower. Investors are working through a slew of corporate earnings reports and economic data as well, with France’s GDP growing in the fourth quarter, while Germany’s shrank due to the Covid-19 pandemic. Elsewhere, the European Commission’s monthly economic sentiment index showed a dip in morale for December. At last check, and the German DAX is eyeing a 2.6% drop, France’s CAC 40 is down 2.5%, and London’s FTSE 100 is 1.7% lower.

 

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