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Stock Futures Edge Up After Nearing Bear Market

U.S. stock futures inched up, putting the S&P 500 on track to edge away from bear-market territory after flirting with such levels in a volatile trading session Friday.

Futures for the S&P 500 added 0.6% Monday. At one point Friday, the S&P 500 slid so far it was on track to close at least 20% below its January peak—what would have been considered a bear market—before regaining ground. Contracts for the tech-focused Nasdaq-100 gained 0.5% Monday, and futures for the Dow Jones Industrial Average rose 0.3%. 

Stocks have slid in recent weeks as investors debated how aggressively the Federal Reserve will raise interest rates to tame elevated inflation. Price pressures have eroded some corporate earnings, but money managers also worry that tightening financial conditions too much risks weighing on economic growth. 

Inflation concerns were exacerbated in recent months as China implemented lockdowns to contain the spread of Covid-19, adding strain to supply chains. Russia’s war against Ukraine has also caused European countries to shift away from Moscow’s oil and gas, adding to prices. 

“This year, we’re dealing with several issues, which in and of themselves would ordinarily be the top story in any given year,” said Hugh Gimber, a global markets strategist at J.P. Morgan Asset Management. “Yet markets are having to deal with them all at the same time.” This has lent to heightened volatility, he said. 

In bond markets, the yield on the benchmark 10-year Treasury note ticked up to 2.821% from 2.785% Friday. Yields and prices move inversely. 

Brent crude, the international benchmark for oil, added 1.1% to $113.80 a barrel. 

Overseas, the pan-continental Stoxx Europe 600 rose 0.4%. The European Central Bank is likely to increase its key interest rate to zero or above by September, President

Christine Lagarde

said in a blog post Monday, drawing a line under an eight-year experiment with negative interest rates amid record-high inflation and mounting concerns about the weakness of the euro currency.

The euro gained 1.1% against the dollar to trade at $1.0674.

Traders worked on the New York Stock Exchange floor on Friday.



Photo:

Ted Shaffrey/Associated Press

In Asia, major indexes closed with mixed performance. Japan’s Nikkei 225 added 1%, while South Korea’s Kospi edged up 0.3%. China’s Shanghai Composite was flat, and Hong Kong’s Hang Seng declined 1.2%.

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com

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Stock Futures Edge Up After Nearing Bear Market Source link Stock Futures Edge Up After Nearing Bear Market

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