Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Dow Futures Fall 175 Pts; Fed Tightening Plans in Focus

Stock Markets May 31, 2022 06:48AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters

By Peter Nurse -- U.S. stocks are seen opening lower Tuesday, handing back some of the previous week’s gains after a long weekend with the Federal Reserve’s plans to tighten monetary policy in focus.

At 7 AM ET (1100 GMT), the Dow Futures contract was down 175 points, or 0.5%, S&P 500 Futures traded 20 points, or 0.5%, lower and Nasdaq 100 Futures dropped 20 points, or 0.2%.

Wall Street was closed on Monday due to the Memorial Day holiday, but the main indices are expected to weaken after the previous week saw the best weekly gains for the Dow Jones Industrial Average and S&P 500 since November 2020.

Investor sentiment was lifted by a combination of solid earnings from the retail sector as well as an inflation report that showed prices could be easing. This gave rise to expectations that the Fed could pause its hiking cycle after two further rises of 50 basis points in June and July.

However, Fed Governor Christopher Waller put a dent into that theory, suggesting that the central bank needs to move interest rates much higher and soon if high inflation does not begin to subside.

"If inflation doesn't go away, that... rate is going a lot higher, and soon," Waller said on Monday. "We are not going to sit there and wait six months...I am advocating 50 on the table every meeting until we see substantial reductions in inflation. Until we get that, I don't see the point of stopping."

Additionally, evidence from Europe wasn’t encouraging after inflation in the Eurozone surged to a new record high in May. The consumer price index in the region climbed to 8.1% in the 12 months through May, up from 7.4% in April and well ahead of analysts' forecasts for a rate of 7.7%.

There is more U.S. data due Tuesday, including the March house price index, the Chicago PMI for May, and most importantly the Conference Board’s consumer confidence index for May, while U.S. President Joe Biden is to meet with Federal Reserve Chair Jerome Powell to discuss how to bring down inflation.

In the corporate sector, there will be more quarterly earnings to digest, with the likes of Salesforce (NYSE:CRM), HP (NYSE:HPQ), and Victoria's Secret (NYSE:VSCO) due to report earnings after the bell.

Oil prices extended gains Tuesday, recording new two-month highs after the European Union agreed to substantially reduce oil imports from Russia, tightening an already strained crude market.

The EU agreed in principle late Monday to cut 90% of oil imports from Russia by the end of 2022, managing to resolve a deadlock with Hungary over the bloc's toughest sanction yet on Russia over its invasion of Ukraine.

By 7 AM ET, U.S. crude futures traded 1.2% higher at $118.62 a barrel, while the Brent contract rose 1.5% to $119.31.

Additionally, gold futures fell 0.3% to $1,850.95/oz, while EUR/USD traded 0.7% lower at 1.0702.

Dow Futures Fall 175 Pts; Fed Tightening Plans in Focus

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Tapan Purohit
Tapan Purohit May 31, 2022 7:42AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Tapering Tantrum
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
Sign up with Email