Stock index futures moved lower Friday as oil prices climbed after strikes on Yemen.
S&P futures (SPX) -0.5% and Dow futures (INDU) -0.7% and Nasdaq 100 futures (NDX:IND) -0.5% slumped as volume picked up.
The market looks set for a winning week after a very strong Monday. The S&P 500 (SP500) is up 1.8% going into Friday’s trading, with the Nasdaq (COMP.IND) up 3% and the Dow (DJI) up 0.7%.
Crude oil (CL1:COM) gained nearly 4% after U.S. and U.K. airstrikes on Houthi rebel positions in Yemen following Red Sea attacks on ships.
Bank earnings will also do much to determine early direction. Bank of America (BAC) reported mixed results. JPMorgan (JPM) Citi (C) and Wells Fargo (WFC) are also due.
Following yesterday’s CPI, which came in a little hotter than expected due mainly to shelter, the December PPI is due before the bell.
“With shelter inflation still running at elevated levels, it’s plausible that you could end up with a larger wedge between the two, with the PCE indicators looking better on a relative basis, which would offer the Fed greater justification to cut rates,” Deutsche Bank’s Jim Reid said. “As part of that, it’ll be worth looking out for today’s PPI reading, as some of the measures there will provide an indication about some of the larger components for core PCE, like healthcare and portfolio management.”
Rates were steady. The 10-year Treasury yield (US10Y) was up 2 basis points to 4%. The 2-year yield (US2Y) was up 1 basis point at 4.27%.