Stock futures fell on Friday as investors awaited Federal Reserve Chairman Jerome Powell’s speech in Jackson Hole, Wyoming.
Futures tied to the Dow Jones Industrial Average fell 87 points, or 0.3%. S&P 500 futures traded 0.4% lower, and Nasdaq 100 futures fell 0.6%.
The moves followed a rally for the major averages that saw the Dow jump around 300 points and the S&P 500 gain 1.4%. The Nasdaq Composite was the best contender, rising 1[ads1].7% as a retreat in yields helped tech stocks.
“Overall, it’s still a very attractive moment to invest in stocks. Underlying corporate earnings are strong for the highest quality companies, and multiples are down due to macro fears. That’s the setup all long-term investors are looking for,” Robert Cantwell, a portfolio manager at Upholdings, told CNBC.
Still, all the major averages are up for their second week in a row. The Dow is on track for a 1.2% decline. The S&P 500 and Nasdaq Composite are heading for slightly smaller declines of 0.7% and 0.5% respectively.
All eyes are on Powell’s long-awaited speech at 10 ET at the Fed’s annual symposium in Wyoming.
Investors are hoping for new guidance on how the Fed will act this autumn, but expectations are lower, and many expect Powell to repeat the Fed’s promise to slow inflation by raising interest rates. Opinions are divided on whether the Fed will raise interest rates by half a percentage point or three-quarters at its next board meeting in September.
Personal consumption expenditures, one of the Fed’s favorite inflation targets, will also be watched ahead of Powell’s speech on Friday morning.
“We’ll probably see some relief tomorrow unless we get a big shock from what Powell says,” Gabriela Santos, global market strategist at JP Morgan Asset Management, told CNBC’s “Closing Bell: Overtime.” “One thing I would keep an eye on as we look into next week and into the fall … implied bond volatility is still very, very high for where it typically is at the end of August, suggesting that we will indeed continue to see a lot of action in the yield curve, which could affect the stock markets in the autumn.”