(Reuters) -U.S. stock indexes were set to rise on Monday as economically resilient sectors benefited from inflation jitters, while investors awaited a slew of retail earnings and economic data this week to gauge the health of consumer spending.
The three major Wall Street indexes had fallen between 0.3% and 0.7% last week on concerns over high inflation and weakening consumer sentiment. Investors had begun pivoting into growth sectors, mainly technology, towards the end of the week.
Market-heavy FAANG stocks rose between 0.2% and 0.8% in premarket trade, with Meta Platforms Inc leading gains.
“(What) you’re seeing with the value-growth trade is a term that you use in football – happy feet. Investors are ready to sort of abandon one and switch into the other when they get some kind of news on inflation,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut.
Electric carmaker Tesla Inc lagged its tech peers, dropping 2.2% after chief Elon Musk got into a spat with Bernie Sanders as the U.S. senator demanded the wealthy pay their “fair share” of taxes.
Tesla’s declines follow a steep 15.4% drop last week after Musk offloaded a combined $6.9 billion worth of shares in the electric-car maker.
Focus this week will be on earnings reports from several major retailers including Walmart Inc, Target Corp, Home Depot Inc and Macy’s Inc. Their results will round off an upbeat third-quarter earnings season, which pushed Wall Street to new highs.
Retail sales data for October is also due on Tuesday, and is expected to show the impact of inflation on consumer spending.
“Inflation is probably going to end up helping (retailers) somewhat because some of these big-box companies are able to … raise prices and maintain pretty close to their margin levels,” Dakota Wealth’s Pavlik added.
At 8:29 a.m. ET, Dow e-minis were up 147 points, or 0.41%. S&P 500 e-minis were up 18 points, or 0.38% and Nasdaq 100 e-minis were up 77.75 points, or 0.48%.
Oil stocks fell tracking declines in the crude market, as rising COVID-19 cases in Europe cast doubts over strong demand. [O/R]
U.S.-listed Chinese stocks, and other China-exposed sectors were muted on mixed data from the mainland, which showed strong industrial output and retail sales, but weakness in the property sector.
Boeing was among the best-performing Dow members before the bell, rising 3.3% after Emirates announced an order for two 777 Freighters and as Saudi Arabian Airlines was in talks with the planemaker for a wide-body jet order.
Dollar Tree Inc added 6.1% after activist investor Mantle Ridge LP revealed a 5.7% stake in the discount retailer.
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