US stock futures remained stable on Monday due to low trading volumes, as markets were closed for the Presidents’ Day holiday. Activity in Asia is also likely to be subdued due to Mainland China’s closure for the week-long Lunar New Year break.
The US stock market will remain closed for trading on account of Presidents’ Day on February 16. Presidents’ Day, also known as Washington’s Birthday, is always held on the third Monday in February.
Presidents’ Day has been a federal holiday since 1879, originally honoring George Washington’s birthday but now recognizing all presidents.
The New York Stock Exchange (NYSE) and Nasdaq are both closed on Monday. After closing at 4 p.m. EST on February 13, the stock market won’t reopen until 9:30 a.m. EST on Tuesday, February 17.
On Presidents’ Day, the U.S. bond market will also be closed, but it’s likely that the federal bank, currency, commodities, and overseas financial markets will all be open. Many commercial banks may be closed on Monday.
Wall Street ended lower last week, with the Dow down 1.23%, the S&P 500 down 1.39%, and the Nasdaq Composite falling 2.1%. Stocks in financial, communication services, consumer discretionary, and technology sectors were badly hit.
Concerns about high AI-related capital expenditures are leading to a deterioration in investor sentiment. This week, investors await earnings results from Walmart, Warner Bros. Discovery, Booking Holdings, Deere & Company, and Palo Alto Networks.
Meanwhile, US 10-year Treasury yields dropped to 4.05%, after softer-than-expected inflation raised bets on at least two Fed rate cuts this year. The annual headline inflation rate decreased to 2.4% in January, down from 2.6% in the previous two months and below the forecast of 2.5%. Monthly inflation eased to 0.2%, deviating from expectations of a steady 0.3%.
Markets anticipate a Fed rate cut in July, with a high likelihood for a June rate reduction as well. Investors are looking to the upcoming Fed minutes release on Wednesday, Q4 GDP data and the core PCE price index report for insights into the US monetary policy direction.
Silver peaked at $121 an ounce in late January before falling to around $64 earlier this month as sentiment reversed. Silver on Monday trades at $77 per ounce. Gold is back above $5,000 per ounce and trades around $5,025 on Monday.
The dollar index held just below 97 on Monday, after falling nearly 10% over the last 12 months. Last week, the dollar came under pressure after soft US inflation data reinforced expectations that the Federal Reserve will cut interest rates later this year.
Falling inflation and weakening of the dollar index supports US Fed rate cut scenario, which in turn boosts gold prices.