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Our market analysts keep you updated on the latest market trends including stock market data, news, market activity, and economic reports in the daily stock market commentary.

Opening Comment — Thursday, February 29, 2024

DJIA: 38,949.02, down 23.39
S&P 500: 5,069.76, down 8.42
NASDAQ: 15,947.74, down 87.56

Stocks lower ahead of PCE deflator data

Stock futures are lower on Thursday, as investors await January’s Personal Consumption Expenditures (PCE) deflator, personal income, and personal spending data releases. The Dow and the S&P 500 are both falling 0.3%. The Nasdaq 100 is also down 0.3% relative to fair value on the GLOBEX.

U.S. equities were lower on Wednesday, as investors evaluated the second readings for the fourth quarter’s Gross Domestic Product (GDP) and core PCE Price Index. The former was revised slightly lower, while the latter was revised slightly higher. The Dow was down 0.1%, while the tech-heavy Nasdaq Composite fell 0.6%. The S&P 500 decreased 0.2% with four of 11 sectors finishing in negative territory. The Communication Services sector declined the most, falling 0.9%.

On the data front today, initial jobless claims for the week ending February 24 are expected to be 210,000, higher than the prior week’s 201,000, while continuing claims for the week ending February 17 are projected to register 1.87 million versus the prior week’s 1.86 million. Personal income is projected to rise 0.4% in January, versus the prior month’s increase of 0.3%, while January’s personal spending is expected to rise 0.2% versus the prior month’s 0.7%. January’s PCE deflator is anticipated to increase 0.3% month-over-month (MoM), versus the previous month’s rise of 0.2%, and increase 2.4% year-over-year (YoY), lower than prior month’s increase of 2.6%. Meanwhile, January’s PCE core deflator, which excludes the more volatile energy and food components, is projected to rise 0.4% MoM, versus the prior month’s change of 0.2%, and rise 2.8% YoY versus the prior month’s increase of 2.9%. January’s pending home sales are projected to increase 1.5% MoM, versus previous month’s increase of 8.3%, and fall 4.4% YoY versus the prior month’s decline of 1.0%. The Market News International (MNI) Chicago Purchasing Managers’ Index (PMI) is expected to register 48.0 for February, higher than the prior month’s 46.0.

Across the pond, European stocks are mixed in mid-day trading with the initial reading for France’s Consumer Price Index (CPI) for February increasing slightly more than expectations, while Spain’s CPI for February came mostly in line with expectations. The final reading of France’s fourth-quarter GDP was revised from a flatline to slight growth.

Overnight in Asia, stocks were mixed with Japan’s industrial production for January decreasing more than expectations in January, while January’s retail sales increased more than anticipated.

In FOREX trading, the dollar is little changed ahead of January’s PCE deflator, the Federal Reserve’s (Fed) preferred measure on inflation.

Over in the commodity pits, West Texas Intermediate (WTI) crude oil is 0.4% lower at $78.22/barrel, following a greater than expected increase in U.S. crude oil inventories. Additionally, indications suggesting that U.S. interest rates might stay high for an extended period further contributed to the downward pressure.

In the metals complex, gold is 0.2% lower at $2038.70/ounce.

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