Stock futures decline after Dow and S&P break 500 records

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The Wall St. sign can be seen near the New York Stock Exchange (NYSE) in New York City on May 4, 2021.

Brendan McDermid | Reuters

Futures contracts pegged to major US stock indices were down early Monday morning as the S&P 500 floated in record territory after last week’s modest gains.

Futures pegged to the Dow Jones Industrial Average fell 71 points. Those pegged to the S&P 500 and Nasdaq 100 also traded in negative territory.

The moves in Sunday’s overnight session came after a largely positive week of trading punctuated by closely watched economic data and corporate earnings.

The Dow closed at 35,515.38 a record high last week while the S&P 500 closed at 4,468.00 on Friday to hit its own best ever close.

The blue-chip Dow and the S&P 500 rounded off the week with subdued gains of 0.8% and 0.7%, respectively, with slight trading volumes in the summer. The technology-heavy Nasdaq Composite performed worse for the week with a minus of just under 0.1%.

The yield on the ten-year benchmark government bond was most recently 1.283%. Bond yields fall when their prices rise.

Investors digested mixed economic data last week.

Perhaps the most notable reading was Wednesday’s weaker-than-expected inflation report, which showed that consumer prices, excluding energy and food, rose less than expected in July. Meanwhile, the Department of Labor said Thursday that weekly jobless claims were 375,000 last week, up by estimates and declining for the third straight week.

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The University of Michigan sentiment for August was just 70.2, its weakest since December 2011, and producer prices were hotter than expected.

Upcoming economic data includes an update on Tuesday’s retail sales, as well as housing starts and the release of the Federal Reserve’s latest minutes of meetings on Wednesday.

The major stock indices posted new record highs last month on the back of robust corporate earnings.

77 percent of the S&P 500 companies reported positive surprises in earnings per share for the second calendar quarter. If 87% is the final percentage, this is the highest percentage of the S&P 500 companies reporting positive EPS surprises since FactSet started tracking this metric in 2008.