A trader works as a screen shows Federal Reserve Board Chairman Jerome Powell’s press conference following the federal rate announcement on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., on December 13, 2023.
Brendan McDermidt | Reuters
U.S. stock futures traded near the flatline after the three major averages posted seventh-week gains on Sunday night. The Dow Jones Industrial Average hit a new intraday record, and the Nasdaq 100 hit a new high.
The future is bound Dow Industries Added 34 points or 0.1%. The S&P 500 Futures also rose 0.1% Nasdaq 100 Futures rose just 0.02%.
The winning streak for the S&P 500 marked its longest weekly gain since 2017. The broad market index is up 3.3% for the month, while the Dow and Nasdaq are up 3.8% and 4.1%, respectively.
Investor sentiment took a positive turn last week after the Federal Reserve indicated that three short-term interest rate cuts are expected in 2024 amid a slowdown in inflation.
“Low inflation, low growth expectations and the pace of growth is an excellent combination from a market perspective. We have repeatedly argued that this is a Goldilocks-like backdrop,” HSBC chief multi-asset strategist Max Ketner wrote in a note on Friday.
However, Kettner noted that near-term growth and earnings expectations in the US remain weak. The current winning streak looks similar to the 2017-2018 market rally, he added, where broad bullish sentiment in January was disappointing “through implicit stock market volatility.”
“So, for the first time in H2, we are starting to be cautious about positive momentum. It might be wise to start 2024 more cautiously,” Ketner said.
On the economic front, investors will look to December’s survey of business leaders and housing market index results. Monday marks the start of the final full trading week of 2023.
