Traders work on the floor of the New York Stock Exchange (NYSE) in New York on December 7, 2022.
Brendan McDermid |: Reuters:
Stock futures rose in early trading Monday after the major averages posted their second straight loss for the first time since September. Investors also struggled to shake off recession fears.
Futures tied to the Dow Jones Industrial Average gained 38 points, or 0.11%, while S&P 500 and Nasdaq 100 futures gained 0.14% and 0.13%, respectively.
The overnight moves followed another drop in stocks last week after the Federal Reserve raised short-term interest rates by 50 basis points and signaled longer interest rates. Recession fears rose as the central bank raised its forecast for future growth from previous expectations, saying it now expects to raise interest rates to 5.1%.
The Dow fell 281.76 points, or 0.85%, on Friday. The 30-share index fell 1.66% for the week, bringing its monthly losses to 4.83%. The S&P 500 fell 1.11% and fell 2.08% for the week, extending its monthly decline to 5.58%. The Nasdaq Composite fell 0.97% on Friday and 2.72% for the week. It is down 6.65% this month.
“Monetary policy has been quickly tightened now that the Fed has raised interest rates by 400 basis points in 9 months,” Ed Moya, senior market strategist at Oanda, wrote in a note to clients on Friday. “The risks of recession will only increase now [Fed chair Jerome Powell] signaled that we should expect “continued increases”.
Earnings season continues this week with reports from Nike and FedEx on Tuesday. The National Association of Home Builders survey, which measures monthly sentiment, is due out Monday.