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Futures: Dow up 0.05%, S&P 500 up 0.2%, Nasdaq up 0.3%
Sept 24 (Reuters) - Futures for the S&P 500 and the
Nasdaq edged higher on Wednesday as investors assessed cautious
commentary from U.S. Federal Reserve Chair Jerome Powell and
looked ahead to key economic data later in the week.
While the recent numbers point to a resilient economy,
comments from Fed officials have injected some wariness,
especially about the labor market. Powell added to the measured
tone on Tuesday, noting that asset prices appeared fairly highly
valued.
He stopped short of aligning with either camp in the ongoing
debate among Fed policymakers, with some pushing for more
aggressive cuts to support the jobs market while others urge
restraint to avoid reigniting inflation.
Instead, the Fed chair emphasized the delicate balancing act
the central bank is faced with to navigate inflation risks while
addressing signs of a softening labor market.
At 5.30 a.m. ET, Dow e-minis rose 22 points, or
0.05%, U.S. S&P 500 E-minis gained 11.5 points, or 0.2%,
and Nasdaq 100 E-minis added 78.5 points, or 0.3%.
A widely expected 25-basis-point cut last week helped propel
equities, but investors are hoping for more easing this year to
keep the momentum going.
"The bias is so heavily skewed towards ultra dovishness that
any shortcomings in commentary can cause a wobble in sentiment,"
Daniela Sabin Hathorn, senior market analyst at online trading
firm Capital.com, said in a note.
There has also been concern about inflated stock valuations
in some sectors. Only 17% of stocks in the benchmark S&P 500
outperformed the index in the last three months, according to
data from Charles Schwab, underscoring the narrow breadth
powering the rally.
Investors will closely watch the core personal consumption
expenditures data, the Fed's preferred inflation gauge, due to
be released later this week. A hotter-than-expected reading
could strengthen the case for a more cautious pace of easing,
while a softer print might reinforce bets on additional cuts.
Meanwhile, housing market data due on Wednesday could offer
insight into consumer demand and builder sentiment, especially
as elevated borrowing costs continue to weigh on affordability.
The sector has been pressured for much of the year and any
signs of stabilization could influence broader sentiment.
Markets may also take cues from an upcoming speech by
Federal Reserve Bank of San Francisco President Mary Daly, who
could shed light on how regional Fed officials are interpreting
the latest data and policy signals.
In stocks, Lithium Americas' U.S.-listed shares
surged 67% after Reuters reported President Donald Trump's
administration was weighing taking an up to 10% equity stake in
the company.
Memory chipmaker Micron Technology's ( MU ) shares also rose
1.3% before the open after it forecast quarterly revenue above
estimates.
Equities have become increasingly central to household
wealth, making market performance a key pillar of consumer
confidence.
Household exposure to stocks rose to a record 65.8% in the
second quarter, higher than their share at the peak of the
dotcom bubble, according to Schwab.