US stock futures rally after slipping from record highs, as all eyes turn to Fed Chair Powell's speech
- US stock futures rose Friday ahead of a key speech from Federal Reserve Chair Jerome Powell.
- It's been a quiet week for stock markets, with investors focused on what Powell might say about monetary policy.
- The Fed is facing conflicting economic signals, with inflation hot but the Delta coronavirus variant raging.
US stock futures climbed on Friday after equities slipped from record highs a day earlier, ahead of a long-awaited speech by Federal Reserve Chair Jerome Powell that could give clues about the direction of US monetary policy.
S&P 500 futures rose 0.29%, after the benchmark US stock index fell 0.58% on Thursday. Nasdaq 100 futures were up 0.3%, and Dow Jones futures moved 0.26% higher.
In Europe, the continent-wide Stoxx 600 index was roughly flat in early trading. In Asia overnight, China's CSI 300 index climbed 0.53%, but Japan's Nikkei 225 fell 0.36%.
It's been a mostly quiet week for markets, with investors largely focused on today's speech from Powell at the annual - and, this year, virtual - Jackson Hole central banking symposium. They have appeared cautious about taking positions before hearing from the central bank's chief, who is scheduled to speak at 10 a.m. ET.
However, analysts are divided about whether Powell will say anything substantive about monetary policy. The Fed is grappling with conflicting signals from the economy: inflation is at a 13-year high, but the spread of the highly infectious coronavirus Delta variant poses new threats.
"The jury remains out on whether Federal Reserve Chairman Powell will specifically address the taper timetable, especially ahead of next week's non-farm payroll numbers," said Richard Hunter, head of markets at Interactive Investor.
The timeline for a taper - that is, slowing the pace of asset purchases, including $120 billion a month in bond buying - is in focus. It would signal the start to an end to the Fed's unprecedented support for the pandemic-hit US economy.
Hao Zhou, senior economist at Commerzbank, said: "Why should Powell of all things today already announce something, if the next monetary policy meeting of the Fed Open Market Committee is taking place only in about a month?"
Yet Hunter said comments from Fed officials on Thursday suggested the central bank is leaning toward an earlier wind-down of stimulus than previously expected. Dallas Fed President Robert Kaplan told CNBC he favors starting to taper bond buying in the final quarter.
Commerzbank analysts said a fall in the dollar since the start of the week was a sign that investors do not think the Fed chair will announce tapering on Friday. The dollar index was little changed at 93.07 on Friday.
Bond yields inched lower, with the key 10-year US Treasury yield down marginally to 1.343%. Yields move inversely to prices.
Elsewhere in markets, oil prices looked to cap a stellar week with further rises. Brent crude oil rose 0.95% to $70.88 a barrel, while WTI crude climbed 1.26% to $68.27 a barrel.
In the crypto world, bitcoin was roughly flat at $47,132. The world's biggest cryptocurrency hit $50,000 for the first time since May earlier in the week, but has since slipped back.