Single stock futures indicated gains on Tuesday as investors focused on a fresh round of earnings reports. Traders were also keeping a close watch on Treasury yields, which have been impacting market sentiment.
Dow Jones Futures Rise 0.4%
Futures linked to the Dow Jones Industrial Average gained 145 points or 0.4%, signalling a positive start. S&P 500 futures and Nasdaq 100 futures also rose 0.5% and 0.7%, respectively.
Earnings Reports: Futures VS Options
General Motors’ premarket performance saw a more than 1% increase after the release of better-than-expected third-quarter results. However, the company withdrew its full-year outlook due to escalating costs related to United Auto Workers union strikes. Coca-Cola reported earnings and revenue that exceeded estimates, resulting in a more than 1% stock price increase. Meanwhile, audio streaming platform Spotify experienced a 4.3% decline, even after surpassing expectations in its third-quarter results.
Positive Earnings Season Trends
About 30% of S&P 500 companies are set to report this week, and early results have been better than expected, with 75% of companies exceeding analysts’ earnings projections.
Impact of Rising Treasury Yields
Wall Street remains cautious amid concerns over rising 10-year Treasury yields, which briefly crossed the 5% mark before retracing. These higher yields have prompted worries about the overall economy and weighed on the stock market in recent weeks. The benchmark rate was at 4.848% on Tuesday.
Market Positive Futures Correction Continues
Despite gains in the Nasdaq Composite, the Dow and S&P 500 finished Monday’s session down about 0.6% and 0.2%, respectively. Investors continue to navigate a challenging market environment influenced by factors like rising inflation and persistent higher interest rates.
General Electric Beats Earnings Expectations
General Electric saw a 5.4% surge in early morning trading after reporting third-quarter earnings and revenue that exceeded Wall Street’s estimates. The company also raised its full-year guidance thanks to increased demand in its aerospace business. GE plans to spin off GE Vernova and launch GE Aerospace in early Q2 of 2024, pending final approval from the GE board and other conditions.
Bitcoin Surges as Market Correction Continues
The price of Bitcoin surged by as much as 15% on Monday, reaching its highest level since May 2022.
Tech Futures Giants’ Interest Rate Futures Outlook
Tech giants Amazon, Alphabet, Meta Platforms, and Microsoft are scheduled to release earnings this week. Alongside earnings reports, the week’s economic calendar includes an estimate of third-quarter GDP growth on Thursday, expected to exceed 4% due to increased consumer spending.
Stock Market Correction: Key Considerations
The Dow Jones Industrial Average and S&P 500 saw losses on Monday, with all three major stock indexes setting new correction lows. Tesla stock experienced a three-day losing streak but bounced slightly on Monday, trying to find support around its 200-day line. Apple and Microsoft stocks saw gains as they tried to recover from recent declines.
IBD Leaderboard Stocks to Watch
Arista Networks, Lululemon Athletica, Meta Platforms, and Zscaler are among the best stocks to buy and watch in the current stock market correction, according to IBD Leaderboard.
Dow Jones Stocks in Focus
JPMorgan dropped 1.4% and is building a flat base. Salesforce is battling for support around its long-term 200-day line, while Apple and Microsoft are trying to recover.
Key Economic Indicators
On Monday, the 10-year U.S. Treasury yield eased from long-term highs, settling at 4.83%. Oil prices fell over 2%, with West Texas Intermediate single stock futures closing just below $86 a barrel.
