Fed Speaks Ahead, Apollo Reported Intel Investment Plan

Investing.com — U.S. stock futures are choppy as traders brace for new economic data and await statements from Federal Reserve officials following last week’s big interest rate cut by the central bank. Elsewhere, asset manager Apollo Global Management is proposing a $5 billion investment in chip maker Intel, as US Republicans unveil a new temporary funding plan as lawmakers face a government shutdown that looms just weeks before the presidential election in November.

1. Turbulent futures

U.S. stock futures oscillated around both sides of the flat line on Monday as investors looked to a slew of fresh economic data this week that could factor into how the Federal Reserve approaches monetary policy for the rest of the year .

By 03:30 ET (0730 GMT), the contract was down 116 points, or 0.3 percent, down 15 points, or 0.3 percent, and down 63 points, or 0.3 percent.

Wall Street’s main averages were broadly lower on Friday, with a frenzy easing somewhat after a rally sparked by an aggressive rate cut by the Fed earlier in the week.

However, 30 stocks hit a new high, fueled by a rise in shares of the sportswear company. NIKE (NYSE: ), which announced the departure of Chief Executive Officer John Donahoe.

2. Speakers Fed forward

Comments from Fed officials in the coming days will likely shed light on last week’s benchmark rate cut of 50 basis points.

Investors will hear from Atlanta Fed President Raphael Bostic on Monday, followed by Chicago Fed President Austan Goolsbee.

Fed Governor Michelle Bowman — the first Fed official to challenge a central bank decision since 2005 — will speak on Tuesday and again on Thursday. Last week, Bowman expressed concern that the jumbo cut would send the wrong signal with the pace of U.S. inflation currently above the Fed’s 2 percent target. Her comments clashed with fellow Fed governor Christopher Waller, who argued that a big cut was needed to keep inflation from exceeding the Fed’s 2 percent target.

Elsewhere, Fed Chairman Jerome Powell will speak at the 10th annual US Treasury market conference on Thursday. New York Fed President John Williams and Supervisory Vice President Michael Barr will also speak at the same event.

3. Apollo proposes $5 billion investment in Intel – Bloomberg News

Apollo Global Management (NYSE: ) has offered to make an investment of up to $5 billion in beleaguered chipmaker Intel Corporation (NASDAQ: ), Bloomberg News reported Sunday.

The asset manager has indicated it would be willing to make a stock-like investment in Intel, the Bloomberg report said, with the chipmaker’s top management considering the offer.

The equity investment would give Intel some much-needed breathing room as the company faces a sharp decline in sales and a potential cash crunch. Intel has previously outlined cost-cutting measures, including cutting the workforce by up to 15,000 employees.

Apollo said earlier this year it would acquire a 49 percent stake in a joint venture for Intel’s new manufacturing facility in Ireland for $11 billion.

4. GOP lawmakers unveil government funding bill

US House Republicans unveiled a new plan that would keep the government funded for three months and avoid a partial shutdown.

The proposal, which excludes a key immigration measure backed by Republican presidential candidate Donald Trump, is expected to be voted on by the lower house of the US Congress on Wednesday, Reuters reported. The government’s current $1.2 trillion in discretionary funding is set to run out on September 30.

If lawmakers fail to pass a bill to secure the funding, much of government operations could be forced to shut down just weeks before November’s crucial presidential election. Thousands of federal workers would also be at risk of being laid off.

Republican US House Speaker Mike Johnson said allowing the government to shut down so close to such a “fateful” vote would be “an act of political malpractice”.

5. Oil rises amid Middle East tensions

Crude oil prices held above the flat line on Monday, supported by concerns that heightened conflict in the Middle East could reduce regional supply.

By 03:32 ET, the contract had gained 0.2% to $73.81 a barrel, while futures (WTI) traded 0.2% higher at $71.10 a barrel.

Traders were seen placing a risk premium on oil prices as Israel continued to carry out strikes in Gaza and Lebanon, playing off concerns of an all-out war in the oil-rich region.

Hezbollah recently vowed retaliation against Israel after the country allegedly detonated several electronic devices used by the Lebanese group.

Constant fighting and threats of war have raised concerns that a wider conflict in the Middle East will disrupt supplies, tightening global markets. Crude oil prices posted a two-week rebound from near three-year lows, boosted by supply concerns in the wake of Hurricane Francine.