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U.S. stock futures were mixed in early trading Monday, while Treasury yields rose, as investors headed into the second half of the year and focused once again on expectations of a Federal Reserve interest rate cut and the strength of a market strengthening for big technology stocks.
The S&P 500 ended the first half of the year with a solid 14.5% gain, largely helped by a massive advance in technology stocks Magnificent 7 and a 150% surge in artificial intelligence chipmaker Nvidia. (NVDA) .
But in the absence of those two names, the benchmark index would still have gained about 6%, well above the long-term average gain of 4.2% during the first six months of the trading year.
Investors are looking for much the same kind of moves as the third quarter gets underway, but will first focus on a slew of labor market data due this week that could add to bets that inflation pressures are easing in the summer months, allowing the Federal Reserve to begin cutting its key borrowing rate in early fall.
The Labor Department will release job openings data for May on July 2, with payroll processing group ADP releasing its National Employment Report on July 3. The key nonfarm payrolls report for June will be released on Friday, July 5.
At present, CME Group’s FedWatch report still forecasts the odds of a September rate cut at around 63%, with similar odds of a follow-up move before the end of the year.
However, benchmark 10-year Treasury yields were moving higher at the start of the week and were last pegged at 4.415%, with the two-year note trading at 4.758%.
The US dollar index, which measures the greenback against a basket of six global currencies, fell 0.23% to 105.622, thanks in part to a sharp rise in the euro after Sunday’s parliamentary elections in France.
As the trading day began on Wall Street, futures contracts tied to the S&P 500 Index, which posted a 3.8% advance during the second quarter, were priced in at a modest 4-point gain at the opening bell.
The Dow Jones Industrial Average, which fell 1.7% during the second quarter, is said to be up 35 points while the Nasdaq is estimated to be down 5 points.
Stocks that are moving include Boeing (Bachelor’s) which was last down 1.2% in early trading at $179.80 per share after the planemaker unveiled an all-stock deal to buy Spirit AeroSystems. (SPR) For $4.7 billion.
Tesla (Tesla) Shares jumped 1.6% ahead of the group’s second-quarter delivery numbers and Wells Fargo’s move to add the stock to its “tactical ideas” list.
More from Wall Street Analysts:
- Analyst Updates Oracle Stock Price Target After Earnings
- Analyst Restarts Trade Desk’s Price Target After Netflix Deal
- Analysts Revise Micron Stock Price Target Ahead of Earnings
In foreign markets, the French CAC 40 index rose by 1.8% following the first round of elections, which showed significant gains for the far-right National Rally party, but could result in a hung parliament through tactical voting and political bargaining in the final elections next week.
The regional Stoxx 600 index rose 0.5% in Frankfurt, with Britain’s FTSE 100 up 0.3% in early London trading.
The Nikkei 225 ended trading overnight in Asia up 0.12% during the Tokyo session after a key survey of economic expectations pointed to renewed inflationary pressures that could lead to a near-term interest rate hike by the Bank of Japan.
Meanwhile, the regional MCSI ex-Japan rose 0.09% at the end of trading.
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