Dow Futures 85 Pts Higher; Powell's Speech the Dominant Focus

By Peter Nurse – U.S. stocks are seen opening just higher Friday, rebounding from the previous session’s losses ahead of a key speech by Federal Reserve Chairman Jerome Powell at the annual Jackson Hole symposium.

At 7:05 AM ET (1105 GMT), the Dow Futures contract was up 85 points, or 0.2%, S&P 500 Futures traded 13 points, or 0.3%, higher, while Nasdaq 100 Futures climbed 55 points, or 0.4%.

The three major indices closed lower Thursday, with the broad-based S&P 500 dropping 0.6%, ending a five-day win streak. The tech-heavy Nasdaq Composite fell 0.6%, also ending a five-day positive run, while the blue chip Dow Jones Industrial Average had closed higher for the four previous days, but dropped 0.5%.

The day’s main event is the virtual gathering of the country’s main central bankers, which traditionally takes place at Jackson Hole in Wyoming and has been used in the past to signal changes in the Federal Reserve’s monetary policy.

Powell is widely expected, at 10 AM ET (1400 GMT), to provide further guidance of the central bank’s plan to slow its $120 billion monthly bond purchases, the start of the withdrawal of the monetary stimulus put in place to support the country’s economy at the outbreak of the Covid-19 pandemic.

There are also economic data releases to be studied Friday, including personal income and spending numbers for July as well as the core PCE price index, the Fed’s preferred gauge of inflation, which has been running near a 30-year high.

In corporate news, computer companies Dell (NYSE:DELL) and HP (NYSE:HPQ) will be in the spotlight Friday after they offered up reserved outlooks with their quarterly results late Thursday, pointing to rising component costs and supply constraints.

Peloton (NASDAQ:PTON) stock will likely be hit after the fitness equipment maker cut the price of its most popular exercise bike and posted a wider loss than expected. It also received a subpoena from the Department of Justice over injuries sustained by users of its treadmills.

More positively, retail chain Gap (NYSE:GPS) handily beat expectations after the close on Thursday.

Elsewhere, crude prices rose Friday, on track to post strong gains this week, with oil companies shutting down production in the Gulf of Mexico as Tropical Storm Ida approaches the region, threatening near-term supply disruption.

Of interest later Friday will be the release of the Baker Hughes rig count data, while the Commodity Futures Trading Commission’s data on net positioning will also be published later.

By 7:05 AM ET, U.S. crude futures traded 1.6% higher at $68.48 a barrel, heading for a weekly gain of more than 8%, while the Brent contract rose 1.4% to $71.18, on track for a rise of more than 9% this week.

Additionally, gold futures were flat at $1,794.95/oz, while EUR/USD traded 0.1% higher at 1.1759.

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