Dow Futures Bounce on Possible Inflation Peak

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A key inflation metric rose at a slower pace in April than March

Stock futures are on the rise once more this morning, with all three major indexes set to snap lengthy weekly losing streaks, should these premarket gains hold. Futures on the Dow Jones Industrial Index (DJIA) are eyeing a 74-point pop, as the index looks to post its first weekly win since late March. S&P 500 Index (SPX) and Nasdaq 100 Index (NDX) futures are also pointed higher, with both indexes eyeing their first weekly win since early April. 

This week’s rebound leaves investors speculating whether the worst of the inflation spikes is over, or if this is just a brief window of optimism before more selling. A slowing inflation report is injecting optimism into markets; the core personal consumption expenditures price index — closely monitored by the Federal Reserve — rose 4.9% in April, compared to March’s 5.2% figure. 

Continue reading for more on today’s market, including:

  • Here are the 25 best stocks to own in June, historically. 
  • The travel stock investors should avoid as summer starts to heat up. 
  • Plus, CGC expects to profit by 2024; BIG earnings a bust; and ULTA soars on upbeat outlook.

5 Things You Need to Know Today

  1. The Cboe Options Exchange (CBOE) saw more than 1.53 million call contracts traded on Thursday, and 967,301 put contracts. The single-session equity put/call ratio stayed at 0.63, and the 21-day moving average rose to 0.62.
  2. The shares of Canopy Growth Corp (NASDAQ:CGC) are down 12.3% in premarket trading, erasing yesterday’s 10.3% gain and set to add to their 77.6% year-over-year loss. The cannabis company posted a wider-than-expected loss for its fiscal fourth-quarter, as well as a revenue miss. Canopy did add, however, that it expects a swing to profits on an adjusted basis by fiscal 2024. . 
  3. Discount retailer Big Lots, Inc. (NYSE:BIG) posted first-quarter earnings an revenue that missed analysts’ expectations, and as a result its stock has shed 18.3% ahead of the open. The plummet puts BIG back within striking distance of its May 24, two-year low of $24.87, as the shares look to build on their 35.2% year-to-date deficit. 

  4. Cosmetics retailer Ulta Beauty Inc (NASDAQ:ULTA) reported a top- and bottom-line beat for its first quarter, while issuing an upbeat earnings and forecast that also topped expectations. Shares of the cosmetics retailer were last seen up 7.6% ahead of the open. Year-to-date, ULTA is up over 15% heading into today.

  5. Friday will bring goods trade balance and the Michigan consumer sentiment index. The 5-year inflation expectation data is also slated to release. 

Bounce in Tech Leads Asian Markets Higher

Asian markets closed out the week with solid gains, following Chinese tech giant Alibaba’s (BABA) fiscal fourth-quarter earnings beat. In other news, Chinese Premier Li Keqiang noted difficulties “even greater than the severe shock of the pandemic in 2020” in a nationwide teleconference meeting, which sought to address the impacts of Covid-19 on the country’s economy. Nonetheless, Hong Kong’s Hang Seng paced the gainers with a 2.9% gain, while South Korea’s Kospi added roughly 1%. Elsewhere, Japan’s Nikkei was 0.7% higher, while China’s Shanghai Composite rose 0.2%.

European markets are also higher, and pacing for weekly gains, after British Finance Minister Rishi Sunak yesterday announced measures to address the region’s cost-of-living crisis. Investors are also eyeing the Russia-Ukraine conflict, after Russia’s Defense Ministry said it will allow foreign ships to leave Black Sea and Sea of Azov ports. This comes after the conclusion of the World Economic Forum, in which economists said Europe could see a recession. At last check, the German DAX and France’s CAC 40 are both 0.7% higher, and London’s FTSE 100 is up 0.2%.