Stock futures flat as indexes snap out of winning month and investors look to Fed meeting

Fed policy will feed into markets in Q2, Q3 of next year, says Treasury Partners' Richard Saperstein

Stock futures were flat on Monday night as traders put a winning month behind them and look ahead to the Federal Reserve’s interest rate decision on Wednesday.

Futures tied to the Dow Jones Industrial Average were down 1 point, almost flat. Futures linked to the S&P 500 and Nasdaq 100 rose 0.1%.

Monday’s trade marked the end of what was the best month for the Dow since 1976, ending up 13.95%, as investors rotated out of technology and secured hopes for stalwarts like banks. The S&P 500 and Nasdaq Composite rose by 8% and 3.9% respectively.

Big Tech was in the spotlight last week as the giants saw shares slide on disappointing earnings, and at times weighed on the Nasdaq. Meanwhile, strong earnings performances from Dow members such as Caterpillar and McDonald’s sent the index higher during the week.

Earnings season continues on Tuesday with Uber, Pfizer and Fox leading the bell and Advanced Micro Devices and Airbnb following.

The Fed’s November meeting also starts on Tuesday, which many market players expect will result in an interest rate increase of 75 basis points. Many will look to the central bank’s statement and Fed Chair Jerome Powell’s question and answer segment for clues about politicians’ fight against inflation.

“We’re pretty confident that market participants seem to be pricing in a 75 basis point increase,” said Jason Ray, founder of Zenith Wealth Partners. “But looking ahead, how they’re going to pick up [it] and see if they change their language on inflation or if the pace of interest rate increases in the future will be something we keep a close eye on.”

IInvestors will also watch for economic releases on Tuesday, including data on job vacancies and construction costs for September, as well as the ISM manufacturing report for October.

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