Stock futures are flat as investors weigh the Fed’s next policy move

Stock futures were little changed Sunday night as investors weighed a possible slowdown or pause in rate hikes by the Federal Reserve and looked forward to an earnings-filled week.

Futures related to the Dow Jones Industrial Average fell 12 points, or 0.04%. S&P 500 futures were down 0.16%, along with Nasdaq 100 futures.

On Friday, the major averages rose to close out the week after briefly losing momentum from the January rally. The NASDAQ posted slight gains for the week. However, the Dow Jones and the Standard & Poor’s both posted their own losing weeks. All major averages remain in green for the month. The Nasdaq is leading the others with a gain of 6.44% year-to-date.

“Markets are becoming increasingly excited that the bout of high inflation is quickly moving behind us and that the period of monetary tightening is coming to an end,” said Brian Levitt, global market strategist at Invesco. “While the economy is likely still facing challenges by the middle of the year, the market is looking forward to what will likely become a sustainable recovery.”

Investors have been weighing the possibility that the Federal Reserve is preparing to slow the pace of its increases in the fight against inflation after economic data showed last week Low wholesale and retail prices. They are also absorbing comments made on Friday by Federal Reserve Chairman Christopher Waller, who said he would favor a quarter-percentage-point increase in rates at the next meeting.

markets It is priced at 99.7% chance of a 25 basis point increase, according to CME Group datawhich brings the interest rate to the target range of 4.5% -4.75%.

There are no speeches from Fed officials on the calendar as the central bank will meet the following week, on January 31 and February 1. However, investors will be watching another batch of economic data, including the Fed’s preferred measure of inflation, and personal numbers. The Consumer Expenditure Price Index, due for release on Friday.

Meanwhile, earnings reports It can keep the market on edge, as about 40% of the Dow Jones index is due to release its latest financial results and give investors more information about how companies are facing inflation and interest rates. Microsoft, IBM, Tesla, Visa, and Mastercard are some of the big names on deck.