By Investors Hub
The major US index futures are pointing to a roughly flat opening on Monday as traders may be reluctant to make any significant moves.
Traders may stick to the sidelines ahead of the release of earnings news from a number of big-name companies later this week.
Bank of America (BAC), Goldman Sachs (GS), UnitedHealth (UNH), IBM (IBM), American Express (AXP), Microsoft (MSFT), Visa (V), and General Electric (GE) are among the companies due to report their quarterly results this week.
Stocks moved mostly higher over the course of the trading session on Friday, extending the upward trend seen over the past several sessions. With the gains on the day, the Dow and the S&P 500 reached new record closing highs.
The major averages pulled back off their best levels going into the close but remained firmly positive. The Dow rose 84.65 points or 0.4 percent to 21,637.74, the Nasdaq advanced 38.03 points or 0.6 percent to 6,312.47 and the S&P 500 climbed 11.44 points or 0.5 percent to 2,459.27.
For the week, the Nasdaq surged up by 2.6 percent, while the Dow and the S&P 500 jumped by 1 percent and 1.4 percent, respectively.
The strength on Wall Street came following the release of several key economic reports, with the data suggesting that the Federal Reserve will not be in any hurry to raise interest rates.
Before the start of trading, the Commerce Department released a report showing retail sales unexpectedly decreased for the second consecutive month in June.
The Commerce Department said retail sales fell by 0.2 percent in June after edging down by a revised 0.1 percent in May. The continued drop in sales surprised economists, who had expected sales to inch up by 0.1 percent.
Excluding auto sales, retail sales still dipped by 0.2 percent in June following the 0.3 decline seen in May. Ex-auto sales were expected to rise by 0.2 percent.
A separate report released by the Labor Department showed consumer prices came in unchanged in the month of June.
The Labor Department said its consumer price index was flat in June after edging down by 0.1 percent in May. Economists had expected consumer prices to inch up by 0.1 percent.
Excluding food and energy prices, core consumer prices crept up by 0.1 percent for the third consecutive month. Core prices had been expected to rise by 0.2 percent.
The report said consumer prices in June were up by 1.6 percent compared to the same month a year ago, a deceleration from the 1.9 percent year-over-year growth in May.
The annual rate of growth in core consumer prices came in at 1.7 percent in June, unchanged from the previous month.
“With its dual mandate, the Fed needs to take into account the decline in the unemployment rate this year as well as the drop back in core inflation,” said Paul Ashworth, Chief U.S. Economist at Capital Economics.
“For that reason, we still expect the Fed to continue raising interest rates in the second half of this year,” he added. “Nevertheless, the odds of a September rate hike are fading.”
Meanwhile, the Federal Reserve released a report showing industrial production increased by slightly more than anticipated in the month of June.
The Fed said industrial production climbed by 0.4 percent in June after inching up by a revised 0.1 percent in May. Economists had expected production to rise by 0.3 percent.
Weakness among financial stocks limited the upside for the markets, with Wells Fargo (WFC), Citigroup (C), and JPMorgan Chase (JPM) all closing lower after reporting their second quarter results.
Electronic storage stocks showed a strong move to the upside over the course of the session, driving the NYSE Arca Disk Drive Index up by 2.1 percent. The index climbed to its best closing level in over a month.
Within the storage sector, NetApp (NTAP) posted a standout gain, surging up by 5.5 percent to its best closing level in over three years.
Significant strength was also visible among gold stocks, as reflected by the 1.5 percent gain posted by the NYSE Arca Gold Bugs Index. The strength in the sector came amid a notable increase by the price of gold. Oil service stocks also saw considerable strength amid an increase by the price of crude oil.
Telecom, semiconductor, and tobacco stocks also saw notable strength on the day, while some weakness was visible among banking stocks.
Adedapo Adesanya