Market Recap: Stocks Rise as Tech Giants Prepare to Report Earnings
Major Indexes Climb on Positive Sentiment
On Monday, October 28, 2024, U.S. stock markets closed higher as investors eagerly anticipated a week filled with crucial earnings reports from tech giants and key economic data releases. The S&P 500 gained 0.4%, while the Dow Jones Industrial Average advanced 320 points, or 0.8%. The Nasdaq Composite also traded 0.6% higher, continuing its upward trajectory.
Tech Sector in Focus
This week marks a significant period for the technology sector, with five of the “Magnificent Seven” companies scheduled to report their third-quarter earnings. Alphabet (GOOGL), Microsoft (MSFT), Meta Platforms (META), Amazon (AMZN), and Apple (AAPL) are all set to release their financial results. Investors are keenly watching these reports, as they could potentially drive the Nasdaq Composite to new heights.
Apple shares rose 0.9%, while Alphabet climbed 0.8% in anticipation of their earnings releases. The performance of these tech giants is crucial, given their substantial influence on market indices and overall investor sentiment.
Market Movers and Shakers
Several stocks made notable moves during the trading session:
1. Boeing (BA): The aircraft manufacturer launched a significant stock sale that could raise around $19 billion. However, this news led to a nearly 2% decline in Boeing’s shares during early trading.
2. Nvidia (NVDA): The AI investor favorite continued its upward trend, gaining ground along with other large-cap technology stocks.
3. Tesla (TSLA): The electric vehicle maker’s stock traded slightly higher, building on its impressive 25% gain over the previous two sessions following a better-than-expected earnings report.
4. Oil Companies: Shares of major oil companies, including ExxonMobil (XOM), Chevron (CVX), Valero Energy (VLO), and Diamondback Energy (FANG), were trading lower as crude oil prices fell more than 5% following Israel’s targeted strikes against Iran, which spared energy facilities.
Economic Indicators and Upcoming Events
Investors are closely monitoring several key economic indicators and events this week:
1. Inflation Data: The September Personal Consumption Expenditures (PCE) price index, a crucial inflation gauge, is expected to be released on Thursday.
2. GDP Growth: A preliminary reading of the third-quarter Gross Domestic Product (GDP) is scheduled for Wednesday, providing insights into the overall health of the U.S. economy.
3. Jobs Report: The highly anticipated September jobs report is due on Friday, offering a comprehensive view of the labor market’s current state.
4. Federal Reserve Meeting: The next Federal Reserve policy meeting is set for November 7, with investors looking for clues about future interest rate decisions.
Global Market Influences
The easing of geopolitical tensions over the weekend contributed to positive market sentiment. While Israel’s retaliatory strikes on Iran on Saturday initially raised concerns, fears were alleviated as oil and nuclear facilities were not targeted. This development led to a significant drop in oil prices, with U.S. crude prices down 6% and the international benchmark Brent also declining.
Looking Ahead
As we move further into the week, market participants will be closely watching the performance of major tech companies and analyzing key economic data. The outcomes of these events could significantly influence market direction in the coming days and weeks.
Mike Dickson, head of research and quantitative strategies at Horizon Investments, noted, “Given high valuations overall, there’s going to be a laser focus on if they’re able to continue to hit those growth numbers.” This sentiment underscores the importance of the upcoming earnings reports in shaping market expectations and performance.
With the U.S. presidential election and the next Federal Reserve meeting on the horizon, investors should brace for potential market volatility and be prepared to adjust their strategies based on new information and market developments.
