Stock futures fell slightly Sunday night as investors await a series of corporate earnings from major technology companies, as well as new economic data releases.
Dow Jones Industrial Average futures were down 45 points, or 0.13%. S&P 500 and Nasdaq 100 futures fell 0.14% and 0.15%, respectively.
All major indexes closed on Friday for a slower week as earnings season kicked off, with several high-profile banking names publishing their quarterly results for the first time since the banks failed in March. The Dow fell 0.23%, ending a four-week bullish streak. The Nasdaq fell 0.42%, while the S&P fell 0.1%.
While 76% of S&P 500 companies that have reported earnings to date have beat analysts’ earnings-per-share estimates, according to FactSet on Friday morning, markets were less optimistic as corporate earnings fell. First-quarter earnings for S&P 500 companies are expected to decline 5.2% overall, according to Refinitiv data.
Wall Street is looking forward to this week’s big tech earnings at what will be the halfway point of earnings season. Alphabet, Microsoft, Amazon, and Meta are among the high-interest names scheduled to report their first-quarter results.
“A lot of these companies took 2022 as an opportunity to throw all the bad stuff into their earnings,” Aswath Damodaran, a professor of finance at NYU’s Stern School of Business, told CNBC on Friday. Next technology earnings.
“I wouldn’t be surprised if we see a lot of positive surprises coming out of their earnings reports,” Damodaran added.
Investors are also closely watching new economic data that will provide insight into whether inflation is slowing, or whether the Federal Reserve will announce another rate hike at its next meeting in early May. First quarter GDP figures will be released, as well as April consumer confidence data among a series of other economic indicators.
“Part of the reason we’ve been so focused on economic data is because we believe the investor narrative is still around the Fed and interest rates. And we think the economic reports over the next seven to 10 days are going to be really big drivers of what it will do,” said Greg Pasuk, CEO of AXS Investments. Finally, the Fed.
Pasuk continued, “We expect the data to be, frankly, mixed. And we think that’s going to continue to cause continued uncertainty and volatility. I think, to some extent, the Fed rate hike has slowed the economy. But there are still elements where things are still It looks very strong. Because of this, we think the Fed is likely to make another rate cut.”
Coca-Cola and Credit Suisse are scheduled to report earnings on Monday before the bell. Whirlpool and First Republic Bank will report results after Monday’s trading session. Traders will also be watching the results of the Dallas Federal Reserve’s manufacturing survey to gauge the state of factory activity in the state.
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