US stocks to open higher; fresh data and FOMC speakers eyed

Wall Street futures pointed to a higher open on Monday, as investors looked ahead of a week loaded with economic data, including the latest inflation report, and speeches from Fed Chairwoman Janet Yellen, as well as numerous FOMC officials.

US equities ended in green territory on Friday in the light of better-than-expected employment figures, which increased expectations for a Federal Reserve interest rate hike later this year.

According to Fed funds tracked by CME Group’s FedWatch tool, market participants are currently pricing in a 50.9 percent probability of a 25 basis points rate move by December.

The US central bank rose its short term interest rate to a range between 1.00 percent and 1.25 percent in June, marking the second adjustment of the year. The regulator also hinted on a possible third hike in upcoming months, depending on labor market conditions and inflation.

The Labor Department said average hourly earnings grew 0.2 percent last month, below an expected increase of 0.3 percent. Nonfarm payrolls came in at 222,000 jobs, outperforming a forecasted addition of 179,000 jobs and a prior reading of 152,000. The unemployment rate ticked up to 4.4 percent, although analysts had estimated no changes for it.

The Dow Jones industrial average was up 94.30 points to end at 21,414.34, with McDonald's leading advancers. The S&P 500 added 0.6 percent to close at 2,425.18, with information technology leading other sectors higher. The Nasdaq composite grew 1.04 percent to 6,153.08.

• Dow Jones Industrial Average: 94.30 / 0.44% / 21414.34
• Standard & Poor’s 500: 15.43 / 0.64% / 2425.18
• Nasdaq Composite: 63.62 / 1.04% / 6153.08

Treasury yields of the benchmark 10-year bond was up to 2.39 percent, while the 2-year yield traded around 1.40 percent. The short term bond is more sensitive to rate changes.

There are no economic reports scheduled on Monday. Among key events coming up this week, Fed’s Yellen testimony on Wednesday and consumer price index on Friday are likely to be the most relevant for market players.

Traders will also pay close attention to the release of second-quarter earnings from major financial institutions such as JPMorgan Chose, Citigroup and Wells Fargo.

Fort Financial Services