Traders on the floor of the NYSE, May 17, 2023.

Source: NYSE

Stock futures were little changed on Monday morning as traders monitored negotiations over the US debt ceiling as government officials scramble to avoid a default.

Futures for the Dow Jones Industrial Average and S&P 500 futures traded flat, while Nasdaq 100 futures were 0.1% lower.

The stock rose last week despite the uncertainty in Washington. The Nasdaq Composite climbed 3.04%, while the S&P 500 rose 1.65%. The Dow rose 0.38%.

President Joe Biden and the Speaker of the House Kevin McCarthyR-Calif., will meet next Monday continue negotiations. Minister of Finance Janet Yellen has said that the US could pay its debts as early as June 1.

The market has continued to grind higher, led by tech stocks, even in the face of a potential debt default and stubborn inflation. Bank of America strategist Savita Subramanian walked her on Sunday final goal of the year for the S&P 500 to 4,300 from 4,000, saying that companies’ focus on efficiency would make earnings more stable and that stocks were not overvalued.

“Current valuations are not low, but are rarely low during earnings downturns. On cyclically adjusted earnings, valuations argue for price returns of 5% per year for the S&P 500 over the next decade,” Subramanian said in a note to clients.

Q1 earnings season is winding down, but there are some notable reports in the coming days, with Zoom video on Monday and Lowe’s and Dick’s Sporting Goods on Tuesday.

The week ahead has a relatively light slate of economic data, highlighted by a second reading for first-quarter GDP on Thursday and the personal consumption expenditure gauge, the Federal Reserve’s preferred measure of inflation, on Friday.

The release of Fed minutes on Wednesday from the May meeting could also shed light on how central banks are thinking about the possibility of further rate hikes.

Fed Chairman Jerome Powell indicated on Friday that stress in the banking system could slow economic growth and reduce the need for higher interest rates.

Traders will also keep an eye on JPMorgan Chase’s investor day on Monday.