Following a strong week for the major averages, during which the S&P 500 and the Dow Jones Industrial Average set fresh all-time highs, futures for S&P Futures fell on Monday. Dow futures fell by 152 points, which is equivalent to a 0.3% reduction in value. Futures contracts on the S&P 500 and futures for the Nasdaq-100 dropped by 0.3% and 0.4%, respectively. Over the course of the past week, the equity market has exhibited a strong upward trend.

The Dow enjoyed a boost of one percent, while the S&P 500 increased by one and two-tenths percent. The technology-heavy Nasdaq saw a rise in value of 2.2 percent. The Russell 2000, which is made up of small-cap stocks, had a significant increase of 2.2 percent, marking the sixth week in a row that the index has performed positively. The Federal Reserve made the decision to reduce interest rates by a quarter of a percentage point last week, which was the first time it has done so since December. The steps that have been taken recently are in response to that decision.  After a lengthy wait, market participants finally received the decision they had been anticipating for so long.

This decision caused some volatility in the market at first, but investors ultimately saw it as a sign that the central bank was taking a more dovish posture, given the growing number of indicators that pointed to a slowing labor market. At the moment, markets are predicting two more quarter-point cuts before the year comes to an end. In order to make sure that the projected course of monetary easing remains intact, investors will examine the macroeconomic data that is scheduled to be released in the near future with more vigilance. On Friday, Emmanuel Cau, made the following statement in writing: “In our opinion, since equities are approaching their highest levels and rates markets are still pricing in [approximately] five times the amount of additional cuts over the course of the next year, the continued support for equities will be more contingent on strong incoming macro data than on any further dovishness in rates.”

The Federal Reserve’s preferred measure of inflation is the personal consumption expenditures price index, and the most recent numbers for this index will be released in the week ahead. It is expected that the numbers will show that the pressure on prices continues to be strong. Those who are involved in the market are of the opinion that inflation will continue to be adequately mild, which will enable the Federal Reserve to maintain its current strategy for monetary policy.