Wall Street futures dipped on Monday as investors braced for a busy week of major earnings reports that could either support or disrupt the market’s ongoing rally.
Boeing (NYSE: BA) jumped 3.6% in premarket trading on news that workers could vote on a new deal to end a costly five-week-long strike. The planemaker is scheduled to report results later this week.
Dow E-minis were down 94 points, or 0.22%, S&P 500 E-minis were down 17.5 points, or 0.30%, and Nasdaq 100 E-minis were down 104 points, or 0.51%.
Benchmark 10-year Treasury yields rose to more than 4.12%, pressuring growth stocks such as Apple (NASDAQ: AAPL) and Microsoft (NASDAQ: MSFT), which edged lower by 0.5% and 0.3%, respectively.
Among S&P 500 companies, 114 are expected to report quarterly earnings this week, including International Business Machines (NYSE: IBM), Tesla (NASDAQ: TSLA) and Coca-Cola (NYSE: KO). Results from Texas Instruments (NASDAQ: TXN) will turn the spotlight on the chip sector.
As of last close, 83.1% of the S&P companies that have reported so far have beaten earnings estimates versus the 79.1% average of the previous four quarters, according to LSEG data.
A fairly solid start to this earnings season, upbeat economic data, and continued optimism around Federal Reserve rate cuts have helped indexes rally higher, with the S&P 500 inching closer to crossing the 6,000-mark milestone for the first time.
The Dow Jones Industrial Average and the benchmark index notched up record closing highs on Friday. Both indexes, along with the Nasdaq, logged a sixth consecutive week of gains in their best winning streak so far this year.
However, risks such as rising geopolitical tensions in the Middle East, gains in Treasury yields, and some volatility ahead of the upcoming U.S. presidential election are pressuring equities.
“Stock markets continue to withstand geopolitical turmoil and uncertainty about the US election… the election is getting closer and the uncertainty will in all likelihood remain at least until election night,” analysts at SEB said in a note.
In broader markets, trades expected to perform well if Republican candidate Donald Trump wins in November were catching a bid, as polls showed the former U.S. president’s chances improving. The U.S. dollar, bitcoin, and gold gained ground.
In other stocks, Spirit Airlines (NYSE: SAVE) skyrocketed 42% after the company reached an agreement to extend a debt refinancing deadline by two months.
Humana (NYSE: HUM) gained 4.4% after a report said Cigna (NYSE: CI) had resumed merger talks with the health insurer.
United Parcel Service (NYSE: UPS) edged 1.8% lower after Barclays downgraded the parcel service provider to “underweight” from “equal weight”.
In economic data, home sales, flash PMI and durable goods readings are due this week, as is the Federal Reserve’s Beige Book.
A number of central bank speakers are due to speak on the day, including Fed officials Lorie Logan, Neel Kashkari, Jeffrey Schmid, and Mary Daly.
(Source: ReutersReuters)
