U.S. stock index futures are expected to open mixed, just below record levels, on Wednesday. Bond markets have stabilized, attracting investor attention as they await more corporate earnings reports.
How Stock-Index Futures Are Trading
- S&P 500 futures (ES00) have risen by 1 point, or 0%, reaching 4976.
- Dow Jones Industrial Average futures (YM00) have gained 3 points, or 0%, reaching 38616.
- Nasdaq 100 futures (NQ00) have climbed by 10 points, or 0.1%, reaching 17670.
Recap of Tuesday's Market Performance
On Tuesday, the Dow Jones Industrial Average increased by 141 points, or 0.37%, reaching 38521. The S&P 500 saw a gain of 11 points, or 0.23%, reaching 4954. The Nasdaq Composite also experienced an increase of 11 points, or 0.07%, reaching 15609.
Investor Focus on Corporate Prospects
With 10-year Treasury yields stabilizing around the 4.1% level, investors are adjusting to the possibility of waiting until May for a potential Federal Reserve interest rate cut. Consequently, more attention is being directed toward corporate prospects.
The ongoing earnings season continues to be a focal point for traders who are eager to assess whether profits can support a market that is operating near its all-time high.
Impact of Recent Earnings Reports
The stock market sentiment was dampened earlier on Wednesday by a sharp decline of 30% in Snap's shares (SNAP). The social media company reported lower-than-expected revenue and provided a disappointing outlook.
In contrast, Ford Motor (F) experienced a boost of 6% in its shares, while Chipotle Mexican Grill (CMG) saw a 3% gain. Both companies delivered promising results and forecasts, which lifted market sentiment.
Companies Reporting Figures
On Wednesday, several companies are set to report their figures. Uber Technologies (UBER), CVS Health (CVS), and Roblox will announce their results before the opening bell on Wall Street. Later in the day, PayPal (PYPL), Walt Disney (DIS), and Arm (ARM) will release their earnings after the market closes.
U.S. Economy and Company Earnings
The thriving U.S. economy, which has managed to perform well despite rising interest rates, has been a significant driver of the current equity rally. Stephen Innes, the managing partner at SPI Asset Management, highlights that the growth of around 5% in S&P 500 operating earnings compared to the previous year has fostered a bullish sentiment among investors. Innes believes that higher rates have not burdened consumers or corporations significantly. As a result, the Federal Reserve can afford to wait longer to ensure inflation control without disrupting the stock market's momentum amidst robust U.S. growth dynamics.
Economic Updates
On Wednesday, there will also be significant economic updates. The trade deficit for December is set to be released at 8:30 a.m. Eastern. Later in the day, at 3 p.m., January consumer credit data will be made available.
Federal Reserve Officials' Comments
Additionally, several Federal Reserve officials will be making comments throughout the day. New Fed Governor Adriana Kugler will speak on policy and the economic outlook at 11 a.m. Boston Fed President Susan Collins will discuss the economic outlook at 11:30 a.m. Richmond Fed President Tom Barkin is scheduled to address the Economic Club of Washington, DC at 12:30 p.m. Finally, Fed Governor Michelle Bowman will talk about supporting small businesses at 2 p.m.
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