Futures Pointing To Mixed Open On Wall Street

The major U.S. index futures are currently pointing to a mixed open on Monday, with stocks likely to show a lack of direction after moving sharply lower last week.

Traders may be reluctant to make significant moves amid uncertainty about the near-term outlook for the markets.

The sell-off seen last week dragged the Dow down to its lowest closing level in over four months, while the S&P 500 ended last Friday’s trading at a two-month closing low.

Traders may also stick to the sidelines ahead of the release of a highly anticipated report on consumer price inflation on Tuesday.

The report is expected to show consumer prices increased by 0.4 percent in February after climbing by 0.5 percent in January.

Core consumer prices, which exclude food and energy prices, are also expected to rise by 0.4 percent in February, matching the increase seen in the previous month.

The annual rate of consumer price growth is expected to slow to 6.0 percent in February from 6.4 percent in January, while the annual rate of core consumer price growth is expected to slow to 5.5 percent from 5.6 percent.

The data could have a significant impact on the outlook for interest rates ahead of next week’s Federal Reserve meeting.

U.S. stocks tumbled on Friday and the major averages all ended notably lower as concerns about the potential fallout from the implosions of Silicon Valley Bank (SVB) and Silvergate Capital (SI) triggered a sell-off in the financial sector.

Investors also digested the crucial non-farm payroll data for the month of February. The data showing an acceleration in U.S. job growth raised concerns the Fed will continue to remain aggressive with regard to interest rate hikes.

SVB Financial Group, which specializes in venture capital financing, announced it had suffered significant losses on its portfolio.

Separately, crypto banking giant Silvergate said it planned to close as the sector faces more turmoil, raising concerns about the wider financial sector.

The Dow ended down 345.22 points or 1.1 percent at 31,909.64. The S&P 500 closed lower by 56.73 points or 1.5 percent at 3,861.59, while the Nasdaq dropped 199.47 points or 1.8 percent to settle at 11,138.89.

The Labor Department said non-farm payroll employment shot up by 311,000 jobs in February after spiking by a revised 504,000 jobs in January.

Economists had expected employment to increase by 205,000 jobs compared to the surge of 517,000 jobs originally reported for the previous month.

Despite the stronger than expected job growth, the report said the unemployment rate rose to 3.6 percent in February from 3.4 percent in January. The unemployment rate was expected to be unchanged.

Commodity, Currency Markets

Crude oil futures are plunging $2.86 to $73.82 a barrel after jumping $0.96 to $76.68 a barrel last Friday. Meanwhile, after soaring $32.60 to $1,867.20 an ounce in the previous session, gold futures are surging $25.70 to $1,892.90 an ounce.

On the currency front, the U.S. dollar is trading at 133.08 yen versus the 135.03 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.0665 compared to last Friday’s $1.0643.

Asia

Asian stocks ended mixed on Monday as regulators from across the world moved to assuage investor concerns of a global ripple effect coming from the United States.

In a statement released Sunday, the Treasury, Federal Reserve and the FDIC said they would “fully protect” depositors with funds in the Silicon Valley Bank.

In addition, Signature Bank, a New York bank, was also closed by regulators over the weekend.

China’s Shanghai Composite Index jumped 1.2 percent to 3,268.70 as Beijing surprised markets by retaining the head of the central bank and finance minister in their posts, prioritizing continuity during a period of uncertainty in the world’s second-largest economy.

Hong Kong’s Hang Seng index rallied 2.0 percent to 19,695.97, led by technology stocks. HSBC closed little changed after it struck a last-minute deal to buy the collapsed Silicon Valley Bank U.K.

Japanese shares fell sharply, with the Nikkei 225 Index closing down 1.1 percent at 27,832.96. The broader Topix ended 1.5 percent lower at 2,000.99.

Tech investor SoftBank Group declined 1.7 percent amid fears of contagion from the collapse of Silicon Valley Bank.

Seoul stocks rose notably to snap a three-day losing streak on hopes for a slower-than-expected rate hike by the Federal Reserve, with analysts at Goldman Sachs saying they no longer expect the U.S. central bank to hike interest rates later this month.

The Kospi gained 0.7 percent to finish at 2,410.60. Naver, LG Chem and LG Energy Solutions rose 1-2 percent.

Australian markets ended lower, dragged down by tech and financial stocks. Mining stocks ended a tad higher on optimism around China’s steel demand.

The benchmark S&P/ASX 200 hit a nearly two-month low before closing half a percent lower at 7,108.80. The broader All Ordinaries Index slipped 0.5 percent to 7,311.

Europe

European stocks have moved lower sharply on Monday, as banks extend their worst two-day sell-off in more than five months on concerns over the fallout from the Silicon Valley Bank (SVB) collapse and ahead of the ECB meeting and key U.S. inflation data due this week.

Over the weekend, the U.S. Treasury, Federal Reserve, and Federal Deposit Insurance Corporation said they would “fully protect” depositors, including those with assets above the federally guaranteed $250,000 limit.

While the U.K.’s FTSE 100 Index has tumbled by 2.0 percent, the French CAC 40 Index is down by 2.3 percent and the German DAX Index is down by 2.4 percent.

Regional banks fell across the board amid increased concerns over the health of the U.S. banking sector and fears of contagion.

HSBC has tumbled after it acquired the U.K. subsidiary of Silicon Valley Bank for 1 British pound to ensure the continuity of banking services, minimize disruption to the U.K. technology sector and to maintain the confidence in the financial system.

SAP has also declined. The German software group has agreed to sell all of its 423 million shares of Qualtrics International Inc. as part of the acquisition of Qualtrics by funds affiliated with Silver Lake as well as Canada Pension Plan Investment Board.

Meanwhile, Ricardo, an engineering and environmental consultancy, has moved higher after it acquired 90 percent of Australian water advisor, Aither Pty Ltd., for 17 million pounds in cash from its founders and co-directors Chris Olszak and Will Fargher.

U.S. Economic Reports

No major U.S. economic data is scheduled to be released today.