Investing.com — US stock index futures edged higher Monday as Wall Street took some relief from softer inflation data, at the start of a holiday-shortened week.
At 05:50 ET (10:50 GMT), rose 5 points, or 0.1%, climbed 10 points, or 0.2%, and gained 60 points, or 0.3%.
Trading is expected to be relatively muted this week, with the New York Stock Exchange closing early Tuesday for Christmas Eve, and the market is shut on Christmas Day.
Investors assess PCE data for rate outlook
data—a key inflation gauge favored by the Federal Reserve—rose 0.1% in November, a slower pace from October’s 0.2% increase. This brought the annual PCE inflation rate to 2.4%, slightly below estimates of 2.5%.
Although the recent data indicated some cooling in inflation, it still remained above the Fed’s 2% annual target, indicating that overall inflation still remained sticky.
The Fed signaled a cautious approach to monetary policy adjustments, emphasizing the need for continued progress on inflation before considering further rate cuts.
Comments from Fed officials on Friday showed that some policymakers were starting to factor in fiscal policy uncertainty, such as tariffs, in their outlooks.
Fed officials reiterated that they were still uncertain about how the new Donald Trump administration policies would affect the interest rate outlook, with some saying it was the very same uncertainty that led them to forecast fewer cuts in 2025.
The Fed by 25 basis points on Wednesday but forecast just two rate cuts in 2025, compared with a prior forecast of four cuts.
Wall Street volatility
The Wall Street indexes have seen volatile trading of late, with the blue-chip suffer a 10-day losing streak, its longest since 1974, slumping over 1,000 points last Wednesday after the Federal Reserve signaled fewer rate cuts for 2025 than previously projected.
Friday’s cooler-than-expected inflation reading helped stocks recoup some of the losses.
Month-to-date, the DJIA is down 4.6% in December, while the is off 1.7%. The tech-heavy bucked the downtrend, rising 1.8% this month.
Investors should “purchase a neck brace” in January, Yardeni Research said, predicting more market volatility as Donald Trump prepares to retake office. This volatility, driven by potential policy changes under Trump 2.0, could present more buying opportunities.
Rumble surges
In corporate news, online video platform Rumble (NASDAQ:) stock surged over 45% in premarket trade following a $775 million investment from Tether, the digital assets company behind the widely used USDT stablecoin.
Crude stable after last week’s losses
Crude prices slipped slightly Monday, as traders digested cooler than expected inflation data with a US shutdown averted.
By 05:50 ET, the US crude futures (WTI) dropped 0.3% to $69.23 a barrel, while the Brent contract fell 0.4% to $72.34 a barrel.
President Joe Biden approved over the weekend a stop-gap spending bill approving government funding until March, ending concerns that a shutdown, especially during the holiday season, would disrupt travel and hurt fuel demand.
Oil markets were also supported by a cooling in price pressures, which opened the possibility of more Fed interest rate cuts next year, potentially boosting economic activity.
Both oil benchmarks fell more than 2% last week on concerns about global economic growth and oil demand.
(Ayushman Ojha contributed to his article.)