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Dow Futures Rise; Nike Shares Jump

by Clarence Jones

Stock futures and Treasury bonds recovered some ground on Friday, offering a glimmer of hope amid a challenging quarter for the markets. However, major indexes still face the possibility of their worst quarterly performance in a year.

The decline in stocks can be attributed to the recent bond selloff, which has pushed the 10-year Treasury yield to its highest level since 2007. The S&P 500 is down 3.3% this quarter, while the Dow has experienced a loss of more than 2%.

Despite these challenges, John Roe, the head of multiasset at Legal & General Investment Management, referred to the recent recovery as a “mini-relief rally.” This suggests that investors are cautiously optimistic about the market’s potential rebound.

On the currency front, the dollar is on track for its best quarter in a year. The WSJ Dollar Index has risen by 2.4% between July and September, primarily driven by the rising yields.

In terms of economic data, the PCE price index, the Federal Reserve’s preferred measure of consumer inflation, rose by 0.4% in August. Excluding volatile food and energy prices, the index increased by 0.1%. Additionally, both personal income and spending rose by 0.4% in August, as expected. The latter was particularly boosted by higher gasoline prices.

Notably, Nike’s shares experienced a significant jump in after-hours trading following the company’s quarterly profit beating Wall Street’s expectations. This positive performance from Nike could potentially have a ripple effect on the overall market.

Looking beyond the US, European stocks and bonds rallied, with the Stoxx Europe 600 adding 1%. Eurozone bond yields also saw a decline, a trend that was further supported by data showing that eurozone inflation cooled more than expected in September.

It’s worth mentioning that mainland Chinese markets were closed for a public holiday, which may have contributed to the overall market dynamics on Friday.

As the quarter comes to a close, investors will closely monitor market movements and economic indicators to determine the direction of the markets in the coming months. While uncertainties remain, the recent recovery in stock futures and Treasury bonds provides a glimmer of hope for investors.

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