Traders on the floor of the New York Stock Exchange.
Stock futures are slightly lower in overnight trading after major indices rose in May.
The futures on the Dow Jones Industrial Average fell 35 points, or 0.10%. S&P 500 futures were down 0.09% and Nasdaq 100 futures were down 0.03%.
The movements in overnight trading were due to the blue chip Dow and S&P 500 rising 1.93% and 0.55% respectively in May to mark their fourth consecutive positive month. The S&P 500 closed just 0.8% from its record high on Friday.
The Russell 2000 small cap rose 0.11% in May, its eighth consecutive positive month – the longest monthly streak since 1995.
The Nasdaq was up 2.06% last week, its best weekly performance since April. However, the tech-heavy composite lost 1.53% in May, breaking a 6-month winning streak.
An important inflation indicator – the core index for personal consumption expenditure – rose by 3.1% year-on-year in April, faster than the forecast increase of 2.9%. Despite the unexpectedly high inflation data, government bond yields fell on Friday.
“Overall, given the market reaction to [Friday]The PCE release may have exaggerated – or perhaps already priced in – investor concerns about inflation, “Goldman Sachs chief executive officer Chris Hussey said in a note.
“There may be consensus that the inflation we are seeing today is ‘good’ inflation – the kind of price increase that comes with accelerated growth, not a policy error,” Hussey said.
Investors await the June 15-16 meeting of the Federal Reserve. What matters to markets is whether the Fed is starting to believe that inflation is higher than expected or that the economy is strengthening enough to move forward without that much monetary support.
May’s employment report, due to be released on Friday, will provide an important overview of the economy. According to the Dow Jones, economists expect about 674,000 jobs to be created in May after much fewer than expected 266,000 jobs were created in April.
Zoom Video Communications and Hewlett Packard Enterprise will release their quarterly results on Tuesday after the bell.
– CNBC’s Patti Domm contributed to the coverage.