U.S. equities drifted at the start of a week packed with corporate earnings and economic data that may help illuminate the Federal Reserve’s path for interest rates.

The S&P 500 was little changed and the Nasdaq 100 shed 0.2 per cent as manufacturing data arrived weaker than forecast and Treasury yields fell amid debt ceiling drama. Shares of Bed Bath & Beyond Inc. declined on plans to shutter all its stores. Meanwhile, the dollar was weaker against major peers, and oil rose.

“Investors are trying to look though all the economic data points as well as earnings comments to discern how the Fed is likely to move,” Paul Nolte, a senior wealth manager at Murphy & Sylvest Wealth Management, wrote in a note.

On deck for a busy week of earnings is First Republic Bank, up 12 per cent Monday, followed by tech majors Microsoft Corp., Meta Platforms Inc. and Amazon.com Inc. U.S. GDP data is forecast to reveal slowing growth, while the so-called core PCE deflator, the Fed’s preferred inflation gauge, is expected to show price growth cooled. 

Swaps markets continue to see interest rates peaking in the coming weeks before a series of cuts later in the year. But, not everyone holds this view. Leveraged investors boosted net short positions on 10-year Treasury futures to a record this month, data from the Commodity Futures Trading Commission show. That indicates they think Fed officials will keep raising rates to tackle inflation.

“Economic data continues to deny investors an obvious growth or policy signal. Demand isn’t falling fast enough to signal an imminent recession, but there are no indications of a reacceleration,” Dennis Debusschere at 22V Research wrote.

The yield on the U.S. 10-year note fell six basis points and ended around 3.51 per cent, testing its 200-day moving average.

In Europe, UBS Group AG climbed after takeover target Credit Suisse AG reported outflows that were lower than some expected. The Stoxx Europe 600 was little changed. Elsewhere, the new Bank of Japan Governor Kazuo Ueda will hold his first policy meeting this week. The bank is expected to soon start its policy review of the past decades.

Key events this week:

U.S. new home sales, consumer confidence, Tuesday
South Korea GDP, Tuesday
Australia CPI, Wednesday
Sweden rate decision, Wednesday
Eurozone economic, consumer confidence, Thursday
U.S. initial jobless claims, GDP, Thursday
Bank of Japan meets on interest rates, Friday
Euro-area GDP, Friday
U.S. personal income, Friday

Earnings highlights:

Tuesday: Pepsi, General Motors, General Electric, McDonalds, Microsoft, UBS, UPS
Wednesday: Boeing, Meta, Hilton
Thursday: Amazon, American Airlines, Intel, Mastercard, Southwest Airlines, Hershey, Honeywell, Barclays

Some of the main moves in markets:

Stocks

The S&P 500 was little changed as of 4 p.m. New York time
The Nasdaq 100 fell 0.2 per cent
The Dow Jones Industrial Average rose 0.2 per cent
The MSCI World index was little changed

Currencies

The Bloomberg Dollar Spot Index fell 0.2 per cent
The euro rose 0.5 per cent to US$1.1043
The British pound rose 0.4 per cent to US$1.2482
The Japanese yen fell 0.1 per cent to 134.31 per dollar

Cryptocurrencies

Bitcoin fell 0.5 per cent to US$27,375.96
Ether fell 1 per cent to US$1,830.4

Bonds

The yield on 10-year Treasuries declined six basis points to 3.51 per cent
Germany’s 10-year yield advanced three basis points to 2.51 per cent
Britain’s 10-year yield advanced two basis points to 3.78 per cent

Commodities

West Texas Intermediate crude rose 1.1 per cent to US$78.76 a barrel
Gold futures rose 0.4 per cent to US$1,999 an ounce