Dow Futures Dip, Nasdaq Rises After Fed Cuts; Big Tech Earnings Spotlight
U.S. stock futures displayed mixed movements on Thursday, following varied performances the previous day. While some indexes saw slight gains, others dipped, demonstrating uncertainty in the market amid evolving economic conditions.
Key Economic Updates
A significant meeting between U.S. President Donald Trump and Chinese President Xi Jinping yielded notable agreements. These included:
- Reduction of U.S. fentanyl tariffs.
- Resumption of substantial U.S. soybean imports by China.
- A settled deal regarding rare earth materials.
The meeting suggests that a broader trade agreement may be forthcoming. However, comments from Federal Reserve Chair Jerome Powell moderated stock expectations. Powell asserted that further interest rate cuts are not guaranteed, which impacted market sentiment.
Market Performance and Futures
As of the latest updates, major stock index futures showed varied performance:
| Index | Change (+/-) |
|---|---|
| Dow Jones | -0.19% |
| S&P 500 | 0.03% |
| Nasdaq 100 | 0.06% |
| Russell 2000 | 0.36% |
The CME Group’s FedWatch tool indicates a 70.4% probability of the Federal Reserve opting for a cut in interest rates during its December meeting. Current bond yields are as follows:
- 10-year Treasury yield: 4.07%
- 2-year Treasury yield: 3.59%
Focus on BigTech Earnings
Investors are paying close attention to earnings from major technology companies. Alphabet Inc. experienced a surge of 7.57% premarket after posting robust financials for Q3, with revenue hitting $102.35 billion and earnings per share at $2.87.
Conversely, Meta Platforms Inc. saw a decline of 7.39%. Despite reporting impressive earnings, the inclusion of a significant non-cash tax charge altered comparability with Wall Street forecasts.
Other Major Tech Performances
- Microsoft Corp. (MSFT): Fell 2.78% due to lower-than-expected second-quarter sales estimates.
- Amazon.com Inc. (AMZN): A slight decrease of 0.50%, with earnings expectations set for post-market release.
- Apple Inc. (AAPL): Shares increased 0.72% ahead of estimated positive earnings.
Market Insights and Upcoming Data
Market analyst Ed Yardeni issued a cautionary overview of the economy, urging the Fed not to exacerbate market speculation. He emphasized that financial instability could arise from maintaining too lenient policies. Conversely, LPL’s Chief Equity Strategist, Jeff Buchbinder, observed that the S&P 500 has defied typical October market trends this year.
Investors Watching for Economic Indicators
Attention will focus on initial jobless claims and GDP data, although recent shutdowns have delayed the release of this information. Additionally, the remarks from Fed Vice Chair Michelle Bowman will be scheduled for 9:55 a.m. ET.
Global markets reflected caution, with crude oil prices dipping slightly, while gold saw a moderate increase.
Investors will continue to monitor these developments as they navigate the complexities of both domestic and international market dynamics.
