U.S. stock markets are unsure of their direction as the trading week begins today. Some significant data releases are lined up for the day and could further direct the pace of monetary tightening.
Data lined up for the day
The Commerce Department published the core personal consumption expenditure (PCE) this morning, showing that February figures were higher by 0.1% from a month ago. Apart from this, the National Association of Realtors published a report on pending home sales for February showing a rise of 3.5% rise and a seven month high. Upticks like these in the data could mean that the Fed has enough room for moving up interest rates.
The growing expectations of a rate hike solidified further after the Federal Reserve Bank’s San Francisco President, John Williams, said that the strong economic indicators will lead to monetary tightening sooner than expected.
Oil prices inch up
The S&P 500 is vascillating around 2033 while the Nasdaq is also mostly unchanged as it has been for nearly 2 weeks now. Today’s data will be followed by Fed Chair Janet Yellen’s commentary on economic and monetary policy tomorrow, March 29.
At the same time, any renewed rally in oil prices could also keep market spirits high throughout the day. Oil traders remain confident that OPEC and non-OPEC members will act positively to contain losses on their oil exports. Disruptions in Nigeria and Iraq are also supporting oil prices to an extent.
In rest of the world, Asian markets traded broadly lower except Japan, which registered a small jump. Reportedly, the recent strengthening in the dollar led to a rebound in export-oriented Japanese equities. Japanese Prime Minister Shinzo Abe is likely to push back an increase in the sales tax which was set to rise to 10% from 8%. The European markets were closed for trading today on account of Easter Monday.