Stock futures edged higher on Monday, trying to build on the rate cut momentum that pushed the Dow Jones Industrial Average to a record closing level. Investors are keenly awaiting economic data on the service and manufacturing sectors, which could provide further insights into the health of the economy. Additionally, market participants will be closely monitoring speeches from key Federal Reserve officials, including Atlanta Fed President Raphael Bostic, Chicago Fed President Austan Goolsbee, and Minneapolis Fed President Neel Kashkari, for clues on the central bank’s future monetary policy direction.

European stocks remained flat in early trading on Monday, reflecting concerns over declining business activity in Germany and France, the region’s two largest economies. In France, the Purchasing Managers’ Index (PMI) for manufacturing and services fell sharply to 47.4, an eight-month low, significantly missing the Reuters forecast of 50.6 and dropping from 53.1 in August. Similarly, Germany’s business activity contracted, with the PMI decreasing from 48.4 in August to 47.2 in September, marking a seven-month low.

Recent economic data highlights several key trends across Asia-Pacific. China’s youth unemployment rate has surged for the second consecutive month, reaching its highest level this year, as reported by the National Bureau of Statistics. This rise reflects a cooling labor market amid broader economic weakening. Meanwhile, the Reserve Bank of Australia is commencing a two-day policy meeting to determine the country’s future monetary direction. In Singapore, both headline and core inflation rates exceeded expectations in August, with year-on-year increases of 2.2% and 2.7%, respectively.

Economic Calendar

Earnings Calendar

Notable reports for Monday before the bell there are no notable reports. After the bell includes AIR.

News & Technicals’

Global semiconductor leaders Taiwan Semiconductor Manufacturing Co. (TSMC) and Samsung Electronics are reportedly in discussions with the United Arab Emirates (UAE) to explore the possibility of establishing Mega factories in the Middle East. According to a report by the Wall Street Journal, these facilities would be primarily funded by the UAE, with Abu Dhabi’s sovereign wealth fund, Mubadala, playing a crucial role in financing the expansion of the country’s domestic semiconductor manufacturing capabilities.

Europe appears to be on the brink of an economic downturn as its largest economies, Germany and France, grapple with political and economic challenges. Recent data released on Monday indicates that business activity in both countries continued to decline in September. In Germany, the HCOB flash composite Purchasing Managers’ Index (PMI) dropped to a seven-month low, while in France, the composite PMI fell to an eight-month low.

Republican House Speaker Mike Johnson has introduced a revised temporary government funding proposal, incorporating significant amendments from the original bill presented earlier this month. The new proposal aims to fund the government through December 20 and notably excludes any provisions of the SAVE Act, a Trump-backed election security measure that would mandate proof of citizenship for voter registration. This adjustment reflects ongoing negotiations and compromises within the legislative process to ensure continued government operations.

RH CEO Gary Friedman explained to CNBC’s Jim Cramer why the upscale home furnishing retailer avoids official social media accounts, emphasizing the importance of authenticity. Friedman criticized paid promotions by online influencers, stating that such tactics lack genuineness. He highlighted that enduring brands earn their reputation by being truthful, rather than relying on “fake fans” or paid endorsements on platforms like Instagram or TikTok. According to Friedman, true brand value comes from honesty and integrity, not from artificial online popularity.

The premarket futures continue push higher hoping to continue the bullish rate cut momentum however, with most stocks in their black out period we should we watchful for a pullback or a resting consolidation as we wait for the next round of earnings.  Slowing economic conditions in Asian and European markets will add some weight to today’s economic reports and could effect today’s sentament.

Trade Wisely,

Doug