5 things to know before the stock market opens Monday

Here are the most important news items that investors need to start their trading day:

U.S. equities markets were on track to open higher Monday morning after three straight winning weeks for the S&P 500, which is recovering from its worst first half in more than 50 years. The Nasdaq also posted a winning week as investors digested the latest jobs report, which was much stronger than expected, as well as chances for future rate hikes from the Federal Reserve, which is in inflation-fighting mode. Markets will also get a fresh read on inflation this week: The latest consumer price index is slated to be released Wednesday, and economists expect it to show a slight slowdown in the red-hot rate of inflation. Follow live stock market updates here.

Senate Democrats, relying on Vice President Kamala Harris’ tiebreaking vote amid unanimous Republican opposition, finally passed a reconciliation package including provisions to battle climate change and bolster health care. The $430 billion bill ended up much smaller than what President Joe Biden and Democratic leaders were looking for, but the party is touting it as a huge victory ahead of the midterm elections this fall. The party in power tends to lose seats in Congress during a president’s first term, and with inflation raging and Biden’s approval ratings in the gutter, Democrats are in danger of ceding control of both chambers. The House is slated to vote on legislation and send it to Biden later this week. Read NBC News’ report here.

The Fed is relatively fresh off its second consecutive three-quarter point rate hike, but expect more to come, according to Fed Governor Michelle Bowman. “My view is that similarly sized increases should be on the table until we see inflation declining in a consistent, meaningful, and lasting way,” She said in remarks over the weekend. Bowman, a voting member of the central bank’s rate-setting Federal Open Market Committee, said high inflation is a bigger threat to the economy than slowing growth. If prices continue to surge like they’ve been doing over the past few months, she said, it “could lead to a further economic softening, risking a prolonged period of economic weakness coupled with high inflation, like we experienced in the 1970s.”

High interest rates have taken a toll on risky tech stocks this year, and SoftBank’s tech-focused Vision Fund is feeling the pinch. The Japanese conglomerate said Monday that the Vision Fund posted a loss of 2.93 trillion yen ($21.68 billion) in the most recent quarter – the second-largest quarterly loss for the fund. Overall, the company reported a record quarterly loss after delivering a profit during the same quarter a year earlier. SoftBank founder Masayoshi Son had already warned during the spring that the company would be more “conservative” with its investments after a massive loss during its previous fiscal year.

China isn’t done with its aggressive drills near Taiwan. The Chinese military said Monday it would conduct new actions in the air and sea near the self-ruled island, which China claims as its own. China’s military had just wrapped up several days’ worth of exercises – its largest ever, according to Reuters – protesting House Speaker Nancy Pelosi’s visit to Taiwan. The drills included the firing of 11 short-range ballistic missiles, while warships, fighter jets and drones made several maneuvers around the island.

– CNBC’s Yun Li, Jeff Cox and Arjun Khrapal contributed to this report.

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