US Stocks Gain Ahead of Mega Tech Earnings, Payrolls Data
The U.S. stock index futures increased on Friday as investors prepared for a series of significant technology earnings and the highly influential monthly employment report in the upcoming week.
The Dow Jones Industrial Average increased by 175 points, or 0.4%, at 09:35 ET (13:35 GMT), while the S&P 500 index increased by 30 points, or 0.5%, and the NASDAQ Composite increased by 135 points, or 0.7%.
Nevertheless, the indices were still on track for losses this week, which would end the six-week winning trends of all three. There has been some profit-taking following a succession of record highs earlier in October, and risk appetite remained frail.
Next week, the earnings of mega tech companies are expected.
The third-quarter earnings season is expected to reach its zenith next week, as five of Wall Street’s “Magnificent Seven” are scheduled to report earnings.
Tuesday will see Alphabet (NASDAQ:GOOGL) report, with Meta Platforms (NASDAQ:META) and Microsoft (NASDAQ:MSFT) following on Wednesday. On Thursday, Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) will disclose their earnings.
The earnings of the five firms are expected to serve as a leading indicator for the broader market, as they account for a substantial portion of the total market capitalization on Wall Street. The primary focus will be on whether artificial intelligence has been a significant earnings driver, particularly in light of the increased capital expenditures in the rapidly expanding sector.
In addition to the Magnificent Seven, a plethora of other Wall Street majors are scheduled to report next week, such as Advanced Micro Devices (NASDAQ:AMD), Caterpillar (NYSE:CAT), Visa (NYSE:V), Ford (NYSE:F), and Uber Technologies (NYSE:UBER).
The corporate news continues.
Following the rejection of a pending merger between the parent company of Michael Kors and Jimmy Choo and handbag manufacturer Tapestry (NYSE:TPR) by a U.S. judge, Capri Holdings (NYSE:CPRI) experienced a drop of more than 40%. Tapestry’s shares experienced a 15% increase.
The stock of Western Digital (NASDAQ:WDC) increased by 11% on Thursday after the memory-chip manufacturer surpassed quarterly profit estimates. Meanwhile, Centene (NYSE:CNC), a health insurer, advanced by 14% after surpassing third-quarter profit estimates.
Furthermore, Apple stock experienced a 0.9% decline following the release of data that indicated a decline in iPhone sales in China during the third quarter, as a result of the severe domestic competition.
The significance of payrolls is substantial.
The advance estimate of third-quarter GDP is scheduled to be published next week, and the fact that new orders for critical U.S.-manufactured capital goods increased more than anticipated in September is a positive prelude.
The influential monthly jobs report is set to be released at the end of next week. This report is expected to garner significant attention, particularly in light of the fact that the previous month’s release was significantly warmer than anticipated, which diminished expectations of additional substantial Fed cutbacks.
Markets also positioned for inflationary U.S. policies in the coming years due to the increased likelihood of a Donald Trump presidency over Kamala Harris.
Crude is expected to experience monthly gains.
The market maintained a risk premium due to tensions in the crude-rich Middle East, which resulted in a rise in oil prices on Friday, setting the stage for a weekly gain.
The Brent contract had increased by 1.6% to $75.56 per barrel by 09:35 ET, while U.S. crude futures (WTI) were trading at $71.31 per barrel, also up by 1.6%.
Traders are anticipating Israel’s response to a missile attack by Iran on Oct. 1, which could disrupt the world’s top oil-producing region. As a result, both contracts are expected to experience gains of approximately 3% this week.
In the near future, US and Israeli officials are expected to resume negotiations for the release of detainees in Gaza and a ceasefire. However, expectations are low due to the failure of numerous previous attempts to negotiate a resolution.
