US stock futures held steady on Friday after a strong rally, with all eyes on the crucial monthly US jobs report that could shift the needle on timing of interest-rate cuts.
S&P 500 (^GSPC) futures were little changed on the heels of notching another record close, while Dow Jones Industrial Average (^DJI) futures slid roughly 0.2%. Futures on the tech-heavy Nasdaq 100 (^NDX) fell 0.1% after Thursday’s sharp gain.
The market got a boost as Chair Jerome Powell told lawmakers the Federal Reserve is “not far” from being confident inflation is in the right place for the central bank to start bringing down borrowing costs.
Investors are now tightly focused on the February jobs data, which is expected to show some signs of cooling after robust gains shocked Wall Street last month. The reading will show whether the pick-up was a one-off — or a sign of underlying strength in the labor market that could persuade the Federal Reserve to wait longer to start cutting rates. The report is due for release at 8:30 a.m. ET on Friday.
Showing how the wind is blowing elsewhere, policymakers from the European Central Bank lined up to support a rate cut there before their summer break as inflation falls faster than expected. Meanwhile, Bank of Japan officials are said to be warming to the idea of finally lifting rates out of the negative zone.
On the corporate front, Costco (COST) shares slipped after its quarterly sales miss overshadowed an earnings beat. Broadcom’s (AVGO) revenue beat and forecast for $10 billion in sales of AI-linked chips failed to impress investors, sending the stock lower.
In commodities, gold futures (GC=F) continued to rally, as spot gold eyed its biggest weekly jump in five months amid optimism for a mid-year Fed rate cut.
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Costco being Costco
Costco (COST) being Costco has historically worked very well for investors.
The company sells giant $1.50 hot dogs at its foodcourt (they taste great, as you can see below in my 2022 photo with retired CEO Craig Jelinek). In the most recent quarter, an 18% online sales increase was fueled by gold bar demand. I surprisingly found (and bought) two tomahawk steaks from my local Costco a few weeks ago for $40 (about five pounds of meat).
Costco just does things differently, it’s built into their DNA. The stock the last five years because members are happy shopping there: +245%.
So I wasn’t surprised to hear Costco’s long-time CFO Richard Galanti (who is retiring soon) on last night’s earnings call reveal it’s getting into the sushi business:
“We recently opened our first fully operated sushi offering in Issaquah, Washington, across the street from our headquarters, with two more planned to open in the very near future. This operation is what we have successfully done for years — for many years, and throughout our Asia Costcos and several countries over there. The sushi program has proven to be a category where we can be successful in both quality and price, and we’re looking forward to seeing more of that in the future.”
Sign me up for a California roll, Rich.
The Costco hot dog is on point. At right, now retired Costco CEO Craig Jelinek. (Yahoo Finance)
