Steady tides, focus on Fed speakers, economic data By Reuters

(Reuters) – U.S. stock index futures were lower on Monday as investors awaited comments from a host of policymakers and data to gauge the outlook for interest rates and the health of the economy, days after the Federal Reserve began its easing cycle.

The Fed’s key monetary policy move last week supported Wall Street’s main indexes for monthly gains, bucking the historical trend of September being a weak month for stocks on average.

After rallying for much of the year, it’s within striking distance of an all-time high, and the blue-chip Dow closed at a record high on Friday. However, given the benchmark’s valuations above its long-term average, there is some caution on subsequent bids.

At 5:36 a.m. ET, the Dow E-minis were up 7 points, or 0.02%, the S&P 500 E-minis were up 5.25 points, or 0.09%, and the E-minis were up 32 .5 points or 0.16%.

Data on Friday showed that equity fund managers increased their net long positions in the contracts in the week ended September 17.

All eyes will be on Fed officials this week, including Chairman Jerome Powell on Thursday, as markets await their news on the state of the economy, which most analysts see as robust, and the outlook for monetary policy.

Governor Christopher Waller moved the needle on trade bets in the previous session after saying that future inflation data could exceed the Fed’s 2 percent target. On the other hand, Michelle Bowman, who voted for a 25 basis point cut at the central bank’s previous meeting, said price pressures were still persistent.

Traders now expect a 53 percent chance the central bank’s next move will be 50 bps easing — up from 29.3 percent a week ago, according to CME Group’s (NASDAQ: ) FedWatch tool. Bets for a 25 bps discount are 47%.

On the day, remarks from Fed chairmen including Raphael Bostic, Austan Goolsbee and Neel Kashkari are due to speak.

“The Fed argued at the September meeting that the US economy remains on solid ground with little sign of an imminent recession. However, markets are likely to remain sensitive to weak economic output,” UBS analysts said.

On the data front, a preliminary survey of September manufacturing and services activity is available at 9:45 am ET. But the focus will be on Friday’s August personal consumption expenditure figures – the Fed’s preferred gauge of inflation.

Among top companies, Intel (NASDAQ: ) rose 4% in premarket trading after a report showed Apollo offered to invest up to $5 billion in the chip maker. Separately, sources said Qualcomm (NASDAQ: ) has explored a potential acquisition of the company.