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Dow futures fall 65 pts; debt talks, job openings, Beige Book in focus

Published 05/31/2023, 07:08 AM
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Investing.com -- U.S. stocks are seen opening with small losses Wednesday, with investors continuing to focus on the passage of the deal to lift the debt ceiling through Congress as the month comes to an end.

At 06:55 ET (10:55 GMT), the Dow futures contract was down 65 points, or 0.2%, S&P 500 futures traded 8 points, or 0.2% lower, and Nasdaq 100 futures dropped 25 points, or 0.2%.

The agreement to suspend the ceiling on U.S. government borrowing for a couple of years cleared an important hurdle on Tuesday, as the House Rules committee signed off on the deal, despite objections from hard-line conservative Republicans.

This clears the way for it to be brought before the lower chamber of Congress as soon as later Wednesday, hopefully allowing the Senate to sign it into law before the federal government runs out of funds in early June.

However, lawmakers on both sides of the aisle have spoken out against it, meaning its passage is still not a certainty.

Heading into the final trading day of May, the main indices had performed in a mixed fashion, with the tech-heavy Nasdaq Composite leading the way, up almost 7.8% on the month. The S&P 500 is up over 2%, while the Dow Jones Industrial Average has fallen 1.9%.

Aside from political developments, investors are also data-watching ahead of Friday’s official jobs report. That report will be closely watched by the Federal Reserve, which is now expected to raise interest rates by another quarter of a percentage point when it meets next month. 

Ahead of that, the job openings report for the end of April is due later in the session, and is expected to come in at 9.775 million, which would be up from the prior month.

The Federal Reserve's Beige Book will also be of interest and a number of Fed officials are also scheduled to speak.

In corporate news, HP (NYSE:HPQ) stock fell sharply premarket after the PC maker posted its lowest revenue for a quarter since early 2020, noting ongoing weakness in demand for personal computers.

Goldman Sachs (NYSE:GS) stock also fell premarket following a number of reports indicating that the investment banking giant is set to cut around 250 more jobs in the coming weeks on the back of a sluggish market for deals.

Oil prices weakened Wednesday after the disappointing Chinese economic data raised further concerns about the economic recovery in the second-largest economy in the world and the largest crude importer.

These worries stand in contrast to the optimism at the beginning of this year, and raised questions over whether a rebound in the country will drive oil demand to record highs this year.

U.S. crude inventories are also due later in the session from industry group American Petroleum Institute, following on from last week’s hefty draw of 6.8M barrels. 

By 06:55 ET, U.S. crude futures traded 2.5% lower at $67.70 a barrel, while the Brent contract dropped 2.2% to $72.09. 

Additionally, gold futures fell 0.1% to $1,975.35/oz, while EUR/USD traded 0.5% lower at 1.0679.

 

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