U.S. stock index futures indicate a lower open for Wall Street today, erasing the slight gains made on Monday.
Investors are grappling with the Federal Reserve’s announcement of prolonged higher interest rates, while JPMorgan CEO Jamie Dimon warned of the possibility of a 7% interest rate scenario.
Before the market opens, S&P 500 futures (SPX) and Nasdaq 100 futures (NDX:IND) are down 0.7%, while Dow futures (INDU) are down 0.6%.
JPMorgan Chase CEO Jamie Dimon cautioned that the world might not be prepared for the Fed’s benchmark interest rate to rise to 7%, warning of potential stress in the system if there are both lower volumes and higher rates.
Dimon’s comments contrast with the prevailing belief that the Fed is approaching the end of its tightening cycle, with the FOMC’s dot plot projecting only one more rate hike. It’s worth noting that Dimon had previously predicted a U.S. recession that did not materialize.
Several headwinds are also impacting market sentiment, including new issues in China’s property market that could have global knock-on effects, rising Treasury yields, and a looming U.S. government shutdown that may begin this weekend.
The economic calendar for today includes the S&P CoreLogic Case-Shiller home price index and the FHFA house price index, both of which exceeded expectations in July. Additionally, consumer confidence, new home sales, and Richmond Fed manufacturing data will be released shortly after regular trading begins.
For more information on today’s market movements, please see the stocks making the biggest moves this morning below.
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