Nasdaq 100 and S&P 500: Stock Futures Climb Ahead of Key Inflation Data Today

Stock Futures Rise Ahead of Key Inflation Data; Dell and Ulta Earnings in Focus

Stock futures edged higher on Friday as traders awaited a key inflation report that could influence the Federal Reserve’s next move. The S&P 500 and Nasdaq are on track for their first weekly losses in three weeks, down 0.8% and 2%, respectively. Meanwhile, the Dow is set for its third consecutive weekly gain, up 0.4%. As August concludes, the S&P 500 is poised to gain 1.3%, while the Dow is up 1.2%. The Nasdaq lags behind, likely to end the month down 0.5%.

At 11:59 GMT, Dow futures are trading 41520.00, up 81.00 or +0.20%. S&P 500 Index futures are at 5631.00, up 21.00 or +0.37% and Nasdaq-100 Index futures are trading 19524.25, up 131.00 or +0.68%.

Focus on PCE Inflation Data

Investors are eyeing the upcoming release of the Personal Consumption Expenditures (PCE) Price Index, a key inflation gauge for the Fed. Expected to show a 0.2% increase in July and a 2.5% annual rise, this report could impact the Fed’s rate decision. The core PCE, excluding food and energy, is forecasted to rise 2.7% year-over-year.

Quincy Krosby, chief global strategist at LPL Financial, emphasized that a higher-than-expected PCE could negatively affect markets, particularly as some Fed members wait for more data before considering rate cuts.

Dell Beats Earnings but Adjusts Guidance

Dell Technologies reported strong quarterly results, driven by an 80% surge in server sales. Revenue reached $25.06 billion, beating expectations, with adjusted earnings per share of $1.89, surpassing the $1.71 consensus. Net income rose 85% from the previous year.

Despite these results, Dell slightly raised its full-year revenue guidance, causing some stock fluctuation. The company’s Infrastructure Solutions Group, which includes AI servers, saw sales jump 38%. However, Dell’s storage and PC-focused businesses experienced declines, highlighting challenges in these segments.

Ulta Beauty Shares Drop on Earnings Miss

Ulta Beauty shares fell over 8% after the retailer missed earnings expectations for the first time in four years and lowered its full-year guidance due to declining same-store sales. Despite a recent $266 million investment from Warren Buffett’s Berkshire Hathaway, Ulta’s stock is down 25% year-to-date.

Market Outlook: Bank Stocks and Rate Cuts

Wells Fargo analysts suggest that large-cap bank stocks could benefit from potential rate cuts, especially if the economy avoids a recession. Historically, bank stocks have rallied after initial declines following rate cuts. With the Fed’s next meeting in mid-September, the PCE data will be crucial in shaping market expectations and moves in the banking sector.

As traders await the inflation report, market volatility is expected, with significant shifts possible depending on how the data compares to expectations.