The U.S. futures traded lower on Tuesday morning as the latest economic data threw a curveball at investors, dampening hopes for a near-term interest rate cut from the Federal Reserve. Futures on the Nasdaq 100 (NDX), S&P 500 (SPX), and the Dow Jones Industrial Average (DJIA) were all down by about 0.25%, 0.18%, and 0.37%, respectively, at 4:35 a.m. EST on April 2.
The manufacturing data released yesterday showed that the Manufacturing Purchasing Managers’ Index (PMI) increased to 50.3% in March, surpassing economists’ estimates of 48.1%. This marked the first time in 17 months that the index crossed the 50% mark, indicating expansion in the manufacturing sector. However, this robust data has raised concerns among some investors that the Federal Reserve may now be less likely to implement interest rate cuts in the near future.
Yesterday, the three major U.S. indices experienced a mixed trend, with the S&P 500 and the Dow Jones indices falling by 0.2% and 0.6%, respectively, while the Nasdaq 100 Index rose by 0.1%.
Looking ahead, major economic reports due for release today include February’s U.S. Factory Orders and JOLTS (Job Openings and Labor Turnover Survey). On the corporate earnings front, Dave & Buster’s Entertainment (PLAY), Paychex (PAYX), and Cal-Maine Foods (CALM) are scheduled to report their quarterly numbers today. Additionally, investors are eagerly anticipating the release of EV giant Tesla’s (TSLA) quarterly delivery numbers.
Meanwhile, the U.S. 10-year treasury yield was down, hovering near 4.31%, while WTI crude oil futures trended higher, nearing $84.66 per barrel, supported by rising geopolitical tensions in the Middle East and tightening supply from Mexico.
In other parts of the world, European indices opened higher today as investors await the release of Eurozone S&P Global Manufacturing PMI, German inflation, and U.K. house price reports.
In Asia-Pacific markets, indices ended the session on a mixed note as traders reevaluated their bets for an interest rate cut in June following the unexpected growth in U.S. manufacturing activity. Hong Kong’s Hang Seng index surged 2.36% higher, while China’s Shanghai Composite and Shenzhen Component indices fell by 0.08% and 0.62%, respectively. Japan’s Nikkei index was up 0.09%, but the Topix index declined by 0.25%.
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