Monday January 31st

US stock  market index futures were mixed in early morning trading Monday as investors braced for the final trading day in what could be the worst month for the S&P 500 since March 2020. Futures tied to the Dow Jones Industrial Average dipped 164 points, or 0.4%, while S&P 500 futures were down 0.4% and Nasdaq 100 futures rose 0.2%. January has turned out to be a dismal month for stocks. The S&P 500 is headed for its worst month since the pandemic-spurred market turmoil in March 2020 as investors worry about inflation, supply chain issues and the upcoming rate hikes from the Federal Reserve. The 500-stock average is nearing correction territory, down more than 8% from its intraday high earlier this month. The S&P 500 is down 7% in January. The Nasdaq Composite, which is roughly 15% off its November record close, is headed for its worst month since October 2008 and the worst first month of the year of all time. The technology-focused average is down nearly 12% in January. The Dow, off by 4.4% this month, is heading for its worst month since October 2020 and the small-cap benchmark Russell 2000 is in a bear market. The major averages experienced violent swings last week, with the Dow moving a gut-wrenching 1,000 points in both directions. The Dow ended the week 1.3% higher. The S&P 500 gained 0.8% last week and the Nasdaq was about flat for the week. “This all kind of results in additional market volatility until investors digest this transition period,” said Michael Arone, chief investment strategist at State Street Global Advisors. “On the other side of this, the economy should continue to expand, earnings are pretty good. That’s enough to sustain markets, but I think they’re adjusting to the shift in monetary policy, fiscal policy and earnings.” Investors have a big week for economic data and some important earnings reports from some of the market’s biggest tech names, including Alphabet, Starbucks, Meta Platforms, Amazon and more. About one-third of S&P 500 companies have reported fourth-quarter earnings and 77% have beaten Wall Street’s earnings expectations, according to FactSet. “Mostly, this week will be all about whether the correction low is already in or whether last Monday’s intra-day low is again challenged and breached,” said Jim Paulsen, Leuthold Group chief investment strategist.  “The longer the S&P stays above last Monday’s low or moves even further away on the upside, the more that calm will return and fundamentals may again start to dominate emotions in driving the market.” Friday will see the December nonfarm payrolls report, which the White House warned Friday could be hit by the omicron surge at the end of 2021. Economists surveyed by Dow Jones expect the report to show a gain of just 178,000 with the unemployment rate holding steady at 3.9%. There also will be several Federal Reserve speakers Monday, including Richmond Fed President Thomas Barkin, who will appear on CNBC around 3 p.m. ET. Last week, the Fed indicated that it is likely to raise interest rates for the first time in more than three years in order to combat historically high inflation. Markets are now pricing in five quarter-percentage-point interest rate hikes in 2022. Shares in Asia were higher on Monday — the final trading day of January, with markets in mainland China and South Korea closed for the Lunar New Year eve. The Nikkei 225 in Japan rose 1.07% to close at 27,001.98 while the Topix index climbed 1.01% to 1,895.93. Despite its Monday gains, the Nikkei 225 dropped about 6% for January. In Hong Kong, the Hang Seng index jumped 1.07% on the day to 23,802.26 while Singapore’s Straits Times index advanced 0.1% to finish the trading day at 3,249.59. Markets in Hong Kong and Singapore closed early on Monday ahead of the Lunar New Year holidays. Oil rose on Monday as a supply shortage and political tensions in Eastern Europe and the Middle East put prices on track for their biggest monthly gain in almost a year. Brent crude was up 77 cents, or 0.86%, at $90.80 per barrel. The front-month contract for March delivery expires later in the day. The most-active Brent contract, for April delivery, was trading at $88.98, up 46 cents, or 0.5%. U.S. West Texas Intermediate crude advanced 10 cents to $86.92 per barrel. The benchmarks recorded their highest levels since October 2014 on Friday, $91.70 and $88.84, respectively, and their sixth straight weekly gain. They were headed for about 17% gains this month, the most since February 2021. Gold prices fell for a fourth consecutive session on Monday and were set for their biggest monthly drop since last September, as the U.S. dollar strengthened ahead of key central bank meetings, making bullion more expensive for holders of other currencies. Spot gold was down 0.2% at $1,788.41 per ounce, as of 0140 GMT, hovering near the previous session’s $1,779.20 - its lowest since Dec. 16. U.S. gold futures were up 0.1% at $1,788.20. The metal has declined more than 2% so far this month. The dollar index hovered close to an 18-month peak scaled last Friday.