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The S&P 500 futures are down 19 points and are trading 0.4% below fair value. The Nasdaq 100 futures are down 104 points and are trading 0.8% below fair value. The Dow Jones Industrial Average futures are down 3 points and are trading roughly in line with fair value.
Equity futures are lower this morning as market participants digest the disappointing guidance from Amazon (AMZN) accompanying their earnings report after yesterday’s close. Participants are also reacting to the latest inflation reading.
Personal income rose 0.4% in September (Briefing.com consensus 0.3%) following a revised 0.3% increase in August (from 0.3%). Personal spending rose 0.6% in September (Briefing.com consensus 0.4%) following a revised 0.6% increase in August (from 0.4%).
The PCE Price Index increased 0.3% (Briefing.com consensus 0.3%) following a 0.3% increase in August. Core-PCE Price index, which excludes food and energy, rose 0.5% in September (Briefing.com consensus 0.4%) following a revised 0.5% increase in August (from 0.6%).
Also, Q3 Employment Cost Index was up 1.2% (Briefing.com consensus 1.2%) following a 1.3% increase in Q2.
The key takeaway from this morning’s release of reports on Personal Income/Outlays and Employment Costs is that the figures were largely in-line with expectations, and they are unlikely to prompt the Fed to reconsider its aggressive rate hike plans.
Treasury yields are inching higher as the 10-yr note yield breaches the 4.00% level. The 10-yr note yield is up nine basis points to 4.03% and the 2-yr note yield is up four basis points to 4.38%.
In general news, the Biden administration is reported considering additional restrictions on exports of advanced technology to China, according to The New York Times.
Also, Japan’s Prime Minister Kishida announced a JPY29 trln extra budget, as expected. The Bank of Japan maintained its ultra-loose policy stance and raised its inflation forecast for 2022 to 2.9% from 2.3%.
Other data releases today include:
- 10:00 ET: September Pending Home Sales (Briefing.com consensus -5.1%; prior -2.0%) and final October University of Michigan Consumer Sentiment survey (Briefing.com consensus 59.6; prior 59.8)
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Originally Posted October 28, 2022 – Market reacts to Amazon guidance and September PCE Price Index
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