TLDR
- US stock futures rose early Monday after the S&P 500 and Nasdaq posted back-to-back weekly losses.
- The Fed, ECB and Bank of Japan announce rate decisions Wednesday, Thursday and Friday.
- Fed funds futures show a 90% chance of a hold, but Bank of America expects a quarter point hike.
- Brent crude fell to $114.52 after hitting its highest level since April.
- Brazilian stocks face a sell-off after Lula’s win, and CoreWeave and Intel slid premarket.
US stock futures rose early Monday as traders looked ahead to a week of central bank decisions. The gains came after the S&P 500 and Nasdaq posted back-to-back weekly losses.
S&P 500 futures were up 0.25%. Dow Jones Industrial Average futures added 155 points, or 0.31%, and Nasdaq-100 futures gained 0.29%.
On Friday, higher oil prices and a broad sell-off pulled the major averages lower. The Dow fell more than 650 points, the S&P 500 lost 0.5% and the Nasdaq Composite dropped 0.2%.
Central Banks Set to Announce Rate Decisions
The Federal Reserve, the European Central Bank and the Bank of Japan will announce decisions on Wednesday, Thursday and Friday. The Fed goes first.
Fed funds futures show a 90% chance the Fed holds rates at the current range of 3.75% to 4%. Bank of America expects a quarter point hike instead.
Bank of America economist Claudio Irigoyen called a hike a “heavy lift” move. He said the October meeting will test Fed Chair Warsh’s resolve to change the Fed’s forward guidance strategy.
Alphabet, Amazon and Microsoft also report earnings this week. They are expected to update investors on their AI spending.
Oil, France and Brazil Move Markets
Brent crude fell 2.20% in Asia to $114.52 a barrel. West Texas Intermediate slid 2.24% to $101.03.
Brent hit its highest level since April on Friday. News reports said the US and Israel could be planning strikes on Iran after the midterm elections.
France’s 10-year bond yield touched 5% last week for the first time since 2002. Yields traded just below that level Monday after weekend protests were relatively orderly.
Moody’s kept France’s Aa3 credit rating and negative outlook on Friday. The agency said it could raise the outlook to stable if the country’s institutions cut the deficit.
Brazilian stocks are set to sell off after President Luiz Inácio Lula da Silva won re-election. He beat Flávio Bolsonaro, who was seen as the more markets-friendly candidate.
A UK-traded ETF tracking Brazilian stocks has slumped by more than a quarter. Lula’s win was unexpected.
CoreWeave slid again in premarket trading as fears around the AI trade continued. Other neocloud and chip stocks, including Intel, also dropped.
Asian markets were mixed. Japan’s Nikkei 225 lost 0.1% while the Topix rose 0.54%, and South Korea’s Kospi fell 0.21%. Hong Kong’s Hang Seng gained 0.66%, and China’s CSI 300 dropped 0.54%.
In the latest trading, E-Mini Dow futures were up 0.44% at $52,622 and E-Mini S&P 500 futures rose 0.28% to $7,681.25. E-Mini Nasdaq 100 futures gained 0.19% to $29,172.75, while Brent crude traded at $109.74.
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