US pre-open: Futures lower as S&P 500 comes off third consecutive winning week

(Sharecast News) - Wall Street futures were in the red ahead of the opening bell on Monday as the S&P 500 comes off its third consecutive winning week. As of 1230 GMT, Dow Jones futures were down 0.01%, while S&P 500 and Nasdaq-100 futures had the indices opening 0.07% and 0.19% softer, respectively.

The Dow closed 123.19 points lower on Friday, while the S&P 500 and Nasdaq Composite closed at fresh record highs on the back of a November jobs report that pointed to stronger-than-expected growth last month.

While last month's non-farm payrolls report revealed payrolls had risen by 227,000, a significant increase from October's upwardly revised print of 36,000, it failed to hurt expectations of a 25-basis point interest rate cut from the Federal Reserve when it next convenes on December 17 and 18.

Later in the week, investors will be paying strict attention to November's consumer price index on Wednesday, as well as Thursday's producer price index, as traders hope to gain further insight into the Federal Reserve's thinking going into its two-day policy meeting next week.

Trade Nation's David Morrison said: "Friday's Non-Farm Payroll report was 'Goldilocks' - not too hot, not too cold - coming in at 227,000, a touch above expectations. There was also an upward revision to the prior release which had been badly affected by a Boeing strike and bad weather. The better-than-expected payroll data was offset by an uptick in the unemployment rate to 4.2% from 4.1%. This was just what the market needed to strengthen the argument for a rate cut at next week's FOMC meeting. The CME's FedWatch Tool saw the probability of a 25 basis point cut shoot up to 87% from 60% a week ago. This is helping to provide a tailwind for equities, and investors are hoping that this doesn't get derailed by this week's inflation updates, with CPI and PPI released on Wednesday and Thursday, respectively. If not, then the stage seems set for a continuation of the rally into Christmas and year-end.

"Investors are certainly riding a wave of optimism over the prospect of a Trump-friendly stock market, on promises of deregulation and a positive tax environment, together with further monetary easing from the Fed next year as well. Even bond yields have backed off the danger levels seen as recently as a fortnight ago as investors have cheered several of Trump's administration picks. What could possibly go wrong? Well, the fear of missing out has led to some reckless speculation, with a significant proportion of that over-leveraged. So, time for caution."

On Monday's macro slate, October wholesale inventories data will be published at 1500 GMT.

No major corporate earnings were slated for release on Monday.

Reporting by Iain Gilbert at Sharecast.com