By Chris Matthews, MarketWatch
5-day winning streak at stake as stocks log best start to a new year since 2006
Stock-index futures pointed to a slightly lower start for Wall Street as investors awaited December inflation data, and as bulls look to avoid snapping the major benchmarks' five-day winning streak, after Thursday's gains helped pull the Dow Jones Industrial Average and the S&P 500 out of correction territory.
How did major benchmarks fare?
Futures for the Dow Jones Industrial Average fell 41 points, or 0.2% to 23,912, while S&P 500 index futures fell by 8.1 points, or 0.3% to 2,588. Nasdaq-100 futures fell by 29.50 points, or 0.5%, to 6,596.
On Thursday, the Dow Jones Industrial Average rose 122.80 points, or 0.5%, to 24,001.92, and the S&P 500 advanced 11.68 points, or 0.5%, to 2,596.64. The Nasdaq Composite Index added 28.99 points, or 0.4%, to 6,986.07.
Need to Know:Here's what might stock the stock market's post-December bounce (http://www.marketwatch.com/story/heres-what-might-stop-the-stock-markets-post-december-bounce-2019-01-11)
Both the Dow and the S&P finished the day up more than 10% from their December lows, marking their exit from correction territory, or when an asset drops 10% from its recent peak.
Read:The stock market just got off to its best start in 13 years (http://www.marketwatch.com/story/the-stock-market-just-got-off-to-its-best-start-in-13-years-2019-01-10)
What's driving the market?
Investors have taken solace in speeches by Federal Reserve officials in recent weeks, as they have continued to spread the message that the central bank will be cautious in its approach to raising interest rates this year.
Fed Chairman Jerome Powell reinforced that message Thursday during a during a discussion at the Economic Club of Washington stressing that the central bank will be "flexible" and "patient" on monetary policy as inflation is "under control."
Friday morning, investors will get a look at the latest inflation numbers, when the Labor Department releases its latest reading of the consumer-price index, a key reading of inflation. Though not the Fed's preferred inflation gauge, the CPI release at 8:30 a.m. Eastern Time will give markets an updated picture of how quickly prices are rising--with higher inflation a potential driver of lower corporate profit margins and more aggressive Fed rate increases.
Investors will also be digesting incrementally good news on the U.S.-China trade front, after U.S. Treasury Secretary Steven Mnuchin told reporters Thursday night that Vice Premier Liu He, the most senior economic policy adviser to President Xi Jinping, would travel to Washington later in January (http://www.marketwatch.com/story/chinas-top-trade-official-expected-to-visit-us-for-trade-talks-mnuchin-says-2019-01-10) to continue trade negotiations, talks that have been seen by markets as gaining momentum this week.
Meanwhile, the partial U.S. government shutdown entered its 21st day, tying the record for the longest in history. While markets have so far shrugged off the drama in Washington, hundreds of thousands of federal workers will not receive paychecks this week, and economists warn that the economic effects of the shutdown could grow significant as the standoff drags on.
What are the analysts saying?
"Stocks are loving that central bank policy appears to be in an ultra-dovish mode," wrote Edward Moya, chief market strategist at Oanda, in a note. "Inflation is low and under control and the main catalyst for the Fed's ability to be patient. If we see softer prints, we could see yields drop and stocks continue their rally."
Which stocks are in focus?
Shares of Netflix Inc. (NFLX) rose 2.1% in premarket action, after the firm was upgraded to strong buy from outperform at Raymond James.
Chico's FAS Inc. (CHS) stock was up 1.9% before the bell Thursday, after the firm announced the closure of 250 stores (http://www.marketwatch.com/story/chicos-fas-to-close-250-stores-in-us-over-three-year-period-as-part-of-digital-expansion-2019-01-11), as part of an overhaul, with the aim of improving its online offering and customer service.
Activision Blizzard Inc. (ATVI) shares were down 7.5% in premarket trade, after the firm announced Thursday (http://www.marketwatch.com/story/activision-blizzard-cuts-ties-to-destiny-studio-2019-01-10)evening that it was ceding rights to the "Destiny" franchise to Bungie Inc. Following the move, Benchmark cut its price target on the stock from $93 to $87, and KeyBanc Capital slashed its price target from $80 to $64.
How are other markets trading?
Markets in Asia rallied (http://www.marketwatch.com/story/fed-restraint-trade-hopes-bolster-asian-markets-2019-01-10) Friday, with Japan's Nikkei closing 1% higher, while Hong Kong's Hang Seng Index added 0.6%, and China's Shanghai Composite advanced 0.7%.
In Europe, stocks edged lower (http://www.marketwatch.com/story/european-markets-up-despite-latest-auto-and-retail-woes-2019-01-11), with the Stoxx Europe 600 down 0.2%.
Crude oil was gunning to extend its winning streak (http://www.marketwatch.com/story/oil-prices-lifted-for-10th-day-as-dollar-softens-2019-01-11) to 10 sessions. Gold prices advanced 0.4%, while the U.S. dollar (http://www.marketwatch.com/story/british-pound-climbs-as-likelihood-of-brexit-delay-rises-2019-01-11) fell 0.3%.
(END) Dow Jones Newswires
January 11, 2019 08:25 ET (13:25 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.