On Sunday evening, stock futures moved lower, signaling a cautious outlook for investors as they brace for a week packed with significant economic data. Following a challenging start to March, futures for the S&P 500 experienced a decline of 0.7%, while Nasdaq 100 futures dropped by 0.9%. Additionally, futures linked to the Dow Jones Industrial Average fell 270 points, equivalent to a 0.6% decrease.
Last week marked a turbulent period for the stock market, with the S&P 500 recording a notable decline of 3.10%, marking its worst weekly performance since September. The Dow fell by 2.37%, and the Nasdaq Composite experienced a loss of 3.45%. These struggles were exacerbated by volatile developments emerging from Washington, D.C., particularly concerning ongoing negotiations over tariffs involving the U.S., Mexico, and Canada.
In a recent interview that aired on Sunday, President Donald Trump responded to a question on Fox News regarding the possibility of a recession. He described the current state of the economy as undergoing a period of transition. This political turbulence is expected to persist throughout the week as a heavy influx of economic data could impact market movements.
Key economic indicators are set to be released this week. The New York Fed survey of consumer expectations is scheduled for Monday, which will be complemented by the University of Michigan consumer sentiment reading on Friday. On the inflation front, the February consumer price index (CPI) is due on Wednesday, followed by the producer price index (PPI) on Thursday. This week, inflation data is anticipated to dominate the economic calendar.
According to Bill Adams, chief economist at Comerica Bank, both the total and core Consumer Price Indexes are expected to rise at a more moderate pace in February, following sharp increases in the previous month. This moderation may result in annual increases holding relatively steady. Furthermore, with the influence of tariffs and tariff threats, producer prices are likely to have risen faster than consumer prices for a second consecutive month, contributing to elevated annual PPI levels.
As investors navigate these developments, attention remains focused on how these economic data points will influence market sentiment and trading strategies in the coming days.
