U.S. Stock Futures Dip as Earnings Season Heats Up
Market Outlook
U.S. stock futures experienced a slight decline on Tuesday, retracing some of the gains from the previous session. The dip comes as the third-quarter earnings season enters full swing. By 06:20 ET (10:20 GMT), the Dow Jones futures contract was down 95 points, or 0.3%, the S&P 500 traded 13 points, or 0.3% lower, and the Nasdaq dropped 45 points, or 0.3%.
Wall Street Performance
On Monday, Wall Street’s main indices recorded significant gains. The Dow Jones Industrial Average surged over 300 points, or 0.9%, while the S&P 500 rose 1.1% and the Nasdaq climbed 1.2%.
Bank Earnings
The market sentiment has been boosted by better-than-expected quarterly earnings. Notable reports include Charles Schwab on Monday and JPMorgan Chase on Friday. According to LSEG data, third-quarter earnings for S&P 500 companies are projected to increase by 2.2%, up from the previous estimate of 1.3%.
Today, investors are eagerly awaiting earnings reports from Bank of America and Goldman Sachs, both from the financial sector. Additionally, pharmaceutical giant Johnson & Johnson is expected to release its earnings.
LinkedIn Layoffs
Microsoft’s LinkedIn unit has announced plans to lay off over 600 employees, which accounts for more than 3% of its workforce. This move comes as the social media network for professionals experiences slowing revenue growth.
Tesla Recall
Tesla has been asked to recall nearly 55,000 Model X vehicles manufactured between 2021-2023. The recall is due to a potential failure in the vehicle controller’s ability to detect low brake fluid and display a warning light.
Retail Sales and Economic Clues
The economic data slate includes U.S. retail sales and industrial production for September. These figures will provide valuable insights into the strength of the U.S. economy as investors anticipate the next Federal Reserve policy-setting meeting in early November.
Furthermore, several Federal Reserve officials are scheduled to speak today, including representatives from New York, Richmond, Minneapolis, and a Board Governor.
Crude Oil Rebound
Oil prices have rebounded after a previous slide caused by hopes that the U.S. would ease sanctions on Venezuela. This potential development could alleviate the tight global supply situation. By 06:20 ET, crude oil futures traded 0.1% higher at $85.31 a barrel, while the Brent crude contract climbed 0.2% to $89.80.
Yesterday, the crude market experienced a $1 per barrel decline following reports that Venezuela’s government and opposition plan to resume talks. If successful, these talks could lead to Washington relaxing its sanctions on oil exports from Venezuela, which were imposed after contested elections in 2018.
U.S. President Biden’s Visit to Israel
U.S. President Joe Biden is scheduled to visit Israel on Wednesday. The visit comes as Israel prepares for a large-scale ground invasion of Gaza as part of its offensive against Hamas militants.
(Oliver Gray contributed to this item.)
