Equity futures up an inch to start the week

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A trader works on the trading floor of the New York Stock Exchange (NYSE), January 5, 2023.

Andrew Kelly | Reuters

Equity futures rallied higher in overnight trading on Sunday after the major averages recorded their first major rally of the new trading year.

Futures linked to the Dow Jones Industrial Average gained 37 points, or 0.11%, while S&P 500 and Nasdaq 100 futures added 0.16% and 0.25% respectively.

The overnight moves followed the first major market rally of 2023 on Friday. The Dow rose 700 points, or 2.13%, while the S&P 500 and Nasdaq Composite added 2.28% and 2.56%, respectively, after December’s jobs report indicated inflation may be easing.

Nonfarm payrolls came in slightly higher than expected, but wages rose at a slower rate than expected. That, and data showing a contraction in the services sector, bolstered hopes that the central bank’s rate hikes are reaching their target.

Friday’s salary report and news of layoffs across industries suggest the job market is weakening, but the economy may have more work to do, according to Rick Rieder, BlackRock’s chief investment officer for global fixed income.

“We believe the moderation in working conditions will continue as parts of today’s report show, but we think demand for labor in the service sector is still holding up and will continue for some time to come,” he said in a statement Friday. note.

All major averages ended the Friday session with weekly gains, with the Dow and S&P posting their best week since November. The Dow and S&P closed their best day since Nov. 30, while the Nasdaq closed its best session since Dec. 29 on Friday.

Monday starts an important week for economic data. December’s consumer price index report will be released on Thursday, followed by major bank data on Friday. In the shorter term, the New York Fed Survey of Consumer Expectations and consumer credit data will be released on Monday. Wall Street will also hear comments from Atlanta Fed president Raphael Bostic.

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