US stock futures ease after a three-day pause during which Biden and Powell will discuss inflation

US stock futures fell Tuesday after a three-day lull, cooling a recent rally as bond yields rebounded.

What’s happening
  • Futures on the Dow Jones Industrial Average YM00,
    fell 111 points, or 0.3%, to 33047.

  • futures on the S&P 500 ES00,
    fell 12.75 points, or 0.3%, to 4143.

  • futures on the Nasdaq 100 NQ00,
    down 5.5 points or 0% to 12672.

On Friday, the Dow Jones Industrial Average DJIA,
up 576 points, or 1.76%, to 33213, the S&P 500 SPX,
up 100 points, or 2.47%, to 4158 and the Nasdaq Composite COMP,
gained 390 points or 3.33% to 12131.

The S&P 500’s 6.6% gain over the past week was its best since the period ended Nov. 6, 2020.

What moves the markets

Heading into the last day of the month, investors wanted to see if the recovery from the mid-May lows would continue.

Interest rate policy will be in the spotlight as President Joe Biden meets Fed Chair Jerome Powell in the afternoon. In an op-ed in the Wall Street JournalBiden said he will not try to influence Fed decisions.

A hawkish speech by Fed Governor Christopher Waller on Monday did not appear to improve sentiment. Waller said he supports rate hikes of half a point until there are signs inflation is cooling towards its 2% target. The core reading of the Fed’s preferred inflation indicator was 4.9% in April.

The yield of the 10-year Treasury TMUBMUSD10Y,
rose 8 basis points to 2.82%.

Waller said the May jobs and CPI reports will be key data “to provide information on the continued strength of the labor market and on the dynamics of inflation.” The May jobs report is due Friday and the CPI report is due the following Friday.

Investors are also taking in the news that Shanghai, China’s largest city, has plans to reopen.

The European Union has separately agreed on a partial ban on Russian crude, to be staggered over several months. US stock futures ease after a three-day pause during which Biden and Powell will discuss inflation

Brian Lowry

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