Nasdaq futures indicated a positive opening on Monday, marking the commencement of a week filled with significant events, including earnings announcements from three major technology companies and the Federal Reserve’s forthcoming interest rate decision. Futures for the Dow Jones Industrial Average, S&P 500, and Nasdaq 100 experienced increases of 0.3%, 0.2%, and 0.2%, respectively, in the latest trading session. Stocks experienced a decline on Friday, with the Dow decreasing by 650 points, as oil prices continued to rise amid threats of intensified conflict in the Middle East. Nonetheless, the blue-chip index concluded the week with a 0.4% increase, marking its third consecutive weekly gain. The benchmark S&P 500 and tech-focused Nasdaq Composite concluded the week with declines of 0.5% and 0.7%, respectively, over the five sessions.
Magnificent Seven mega-cap tech stocks Alphabet and Microsoft are slated to issue earnings reports after markets close Wednesday, and Amazon is set to do so Thursday. The Roundhill “MAGS” ETF, which tracks the septet, closed 0.5% lower on Friday, with Microsoft being the sole stock in the group to end the session in positive territory, and it ticked lower before the bell. In addition to the tech earnings, a significant narrative in the markets this week is anticipated on Wednesday, when the Federal Open Market Committee is set to reveal its decision regarding the stance on interest rates. Economists anticipate that the Federal Reserve will increase interest rates in upcoming meetings to address elevated inflation levels. However, they assert that there is no immediate necessity to implement a second consecutive rate hike after the increase in September. Financial markets currently reflect a mere 9% probability that the Federal Reserve will implement a rate increase this week, according to CME FedWatch.
Positive outliers from the last session included memory and other AI-related stocks, which indicated further upward movement in premarket trading. Roundhill’s Memory ETF rose 1.5% after a 3% gain on Friday, while the broader iShares Semiconductor ETF advanced nearly 1% following a 0.5% increase. However, neocloud stocks CoreWeave and Nebius Group declined more than 2% apiece after SpaceX CEO Elon Musk wrote on his X platform that “debt markets have almost entirely shut off access to money for any company that doesn’t have substantial revenue independent of AI data centers,” and “the 200+ neoclouds are going to see guppy-level death and consolidation.” Musk said SpaceX, by contrast, “closed $40B of debt for GPUs, but we’re investment grade and have Starlink & launch revenue,” and shares pointed up 1%. Moderna stock, which dropped 19% over the last two sessions after an apparent leak of cancer-vaccine data, tumbled a further 11% in premarket trading.
On a relatively quiet day of corporate earnings reports, Verizon Communications stands out as the most significant entity releasing results. Its shares rose 2% after it posted a profit beat, raised various full-year projections, and inked a $2 billion AI infrastructure deal with Amazon. Oil prices experienced a decline following significant increases that characterised the end of the previous week. U.S. benchmark West Texas Intermediate crude futures experienced a decline of approximately 2%, settling at $101.20 per barrel in recent trading. Brent crude futures, the international benchmark, experienced a decline of 1.5% to $115, yet they continue to hover close to their peak levels observed since late April. The 10-year Treasury yield decreased by one basis point, settling at 4.99%. Bitcoin was trading around 80,400, little changed over the past 24 hours. The U.S. dollar index, which monitors the value of the greenback against a basket of foreign currencies, remained relatively unchanged at 101.78. Gold futures increased by 0.6%, reaching a price of $4,030 per ounce.
