Stock futures fell ahead of another block of retail earnings on Monday to start a week shortened for the Thanksgiving holiday.
Futures for the Dow Jones industrial average fell 18 points, or 0.05%. S&P 500 and Nasdaq 100 futures fell 0.31% and 0.47%, respectively.
Disney bucked the downside, however, and has since rallied more than 8% The media company announced that Bob Iger will return as CEO, effective immediately.
Investors are reflecting on the strength of the recent bear market rally, which began at the beginning of the month with the October consumer price index reading and gained some steam with last week’s reading of wholesale prices.
Traders were left hanging on messaging from Federal Reserve officials last week, who were less impressed with the data and reassessed their confidence about the prospect of slowing inflation. On Tuesday, Cleveland Fed President Loretta Mester and St. When St. Louis Fed President James Bullard speaks, the market will get more Fedspeak to digest.
Yardeni Research’s Ed Yardeni said in his view, the Oct. 12 lows and the S&P 500 could climb closer to 4,300 by the end of the year, he told CNBC’s “Closing Bell: Overtime” Friday night. The key index is currently at 3,965.34.
“The biggest difference in the market is the resilience of the economy, which is spectacular,” he said. “Everybody’s debating whether we’re in for a soft landing or a hard landing — meanwhile, there’s been no landing. Consumers haven’t gotten the recession memo, they’re spending.”
Retail sales rose in October, but at the corporate level Target reported a drop in demand and Amazon announced it would lay off 10,000 employees — although Home Depot and Walmart reported strong results.
“Regardless of what holiday spending suggests, retail stocks will be in the top third in November, but in the bottom third in December, and somewhere in the middle in January,” Liz Young, chief investment strategist at SoFi, said in a note this weekend.
“Seasonality has a place in market analysis and has some predictive power. But the power of the economic cycle is strong no matter the time of year,” he added. “With the Fed’s 375 basis point hike so far, an inverted yield curve, an increase in inflation and commodity prices still part of the story, we can all conclude that we are late in the economic cycle.”
This week, due to the Thanksgiving holiday, investors will be busy with another group of retail earnings. Companies on deck include Best Buy, Nordstrom, Dick’s Sporting Goods and Dollar Tree.