Russell 2000 steady
The Russell 2000 futures are a hair below the flat line and the small-cap index looks to a steady opening after Thursday’s sell-off, following news that U.S. economic growth accelerated in the second quarter.
The U.S. economy expanded at an annualized rate of 3.4% in the second quarter, the Commerce Department reported this morning. That’s above the projected rate of 3.2% and the best performance since the first three months of 2006.
Exports rose as strong economic growth and a weak dollar contributed to higher global demand for Americans goods.
Economic growth in the first quarter was a downwardly revised pipsqueak pace of 0.6%, compared with a previous estimate of 0.7%.
More good economic news came in the form of lower inflation.
Core consumer prices, which exclude the volatile costs of food and energy, increased at an annual pace of 1.4%, the slowest in four years.
The U.S. Federal Reserve has on numerous occasions said that it prefers core inflation in the range between 1% and 2%. The Fed considers inflation to be its biggest concern.
Investors will also be paying attention to the University of Michigan’s Consumer Sentiment Index, which will be released at 10 a.m. ET.
Consumer spending, which accounts for over 70% of the U.S. economy, grew at an unimpressive annualized pace of 1.3% in the second quarter, below the rate of 3.7% during the first three months of the year. High-spending Americans consumers have recently shouldered the burden of keeping the economy humming along.
