Traders work at the New York Stock Exchange (NYSE) in New York City, U.S., on October 27, 2023.
Brendan Mcdermid | Reuters
US stock futures opened slightly higher ahead of a big week filled with a Federal Reserve rate decision, a jobs report and Apple's earnings report.
S&P 500 Futures added 0.3%, while Nasdaq-100 Futures gained 0.4%. Dow Jones Industrial Average Futures they rose 0.1%.
The S&P 500 fell into correction territory last week, losing 2.5% over the week to put it 10.6% below its 2023 high. The benchmark index is down 4% in October, on track of its third consecutive negative month, which would be its first such streak since 2020, when the pandemic occurred.
The Federal Reserve's decision looms on Wednesday, and the central bank is expected to keep its benchmark interest rate at the same level. With rising interest rates being the main culprit behind this stock market correction, investors will be waiting for the Federal Reserve to signal that rates can be raised. Traders expect the Federal Reserve to finish raising rates by at least 2023.
The 10-year Treasury yield jumped above 5% early last week, but ended at 4.84%. The October jobs report is due out on Friday, and investors are hoping for some slowdown in the labor market that will allow the Federal Reserve to feel comfortable staying on hold for the rest of the year.
Apple will report its results on Thursday after the bell. The largest member of the S&P 500 is in a correction, down 15% from its 52-week high.
The selloff has focused on the Nasdaq and technology stocks, which investors believe would be hurt the most by rising interest rates. The Nasdaq Composite has lost more than 12% from its 2023 peak, firmly in correction territory. The Nasdaq and Dow, along with the S&P 500, are headed for their third consecutive negative month. Recent disappointing gains by Big Tech FANG stocks, such as Google parent Alphabet, have added to the sell-off.
Nasdaq Composite, Year to Date
"FANG didn't do well this week earnings-wise and it really took some of the support out of the stock," Tom Lee, co-founder of Fundstrat Global Advisors, said on CNBC on Friday.
"Do I think the FANG thesis has changed or broken? I mean, I don't think so. To me, if someone hasn't owned FANG all year, this is an opportunity to get in."
McDonald's will begin publishing earnings reports with its quarterly update before the bell on Monday.
