Market Recap: Wall Street Gains as Tech Earnings Week Kicks Off
Major Indexes Close Higher Amid Geopolitical Relief
On Monday, October 28, 2024, U.S. stock markets closed higher, kicking off a pivotal week packed with Big Tech earnings, inflation updates, and crucial economic data. The S&P 500 (^GSPC) rose 0.43% to 5,833.27, while the Dow Jones Industrial Average (^DJI) gained 0.53% to 42,338.12. The tech-heavy Nasdaq Composite (^IXIC) jumped 0.60% to 18,630.63, reflecting investor optimism ahead of major tech earnings reports .
Geopolitical Tensions Ease, Oil Prices Plunge
Market sentiment improved as geopolitical risks in the Middle East showed signs of easing. Israel’s limited retaliatory strike on Iran’s military facilities over the weekend, which avoided targeting oil infrastructure, helped alleviate concerns about a potential escalation in the region. As a result, crude oil prices plummeted nearly 6%, with West Texas Intermediate (CL=F) trading near $67 per barrel .
Tech Giants in Focus as Earnings Week Begins
Investors are eagerly awaiting earnings reports from five of the “Magnificent Seven” mega-cap tech companies this week. Alphabet (GOOGL), Apple (AAPL), Amazon (AMZN), Microsoft (MSFT), and Meta Platforms (META) are all set to release their quarterly results, which could significantly impact market direction . These reports are expected to provide insights into the tech sector’s growth and the impact of AI investments on profitability.
Notable Stock Movements
Several stocks made significant moves during Monday’s trading session:
1. Nvidia (NVDA): The AI chip giant saw its shares rise 0.23% to $141.86, as investors positioned themselves ahead of Big Tech earnings .
2. Trump Media & Technology Group Corp. (DJT): The stock surged 15.33% to $44.92, continuing its volatile trading pattern .
3. Boeing (BA): Shares dipped 2.24% to $151.54 as the company launched a massive $19 billion stock sale to shore up its finances and avoid a potential credit rating downgrade .
4. Philips (PHG): The medical device maker’s stock plummeted 16.90% after cutting its full-year sales outlook due to weak Chinese demand .
Economic Data and Fed Watch
Investors are bracing for a slew of economic data this week that could influence the Federal Reserve’s decision on interest rates. Key releases include:
1. The Fed’s preferred inflation gauge
2. October jobs report (expected payrolls: +90,000; unemployment rate forecast: 4.1%)
3. Dallas Fed manufacturing activity for October
These reports will be crucial in determining whether the Fed will maintain its current stance or consider rate cuts in the near future. Currently, markets are pricing in a 96% chance of no change at the upcoming November 6-7 FOMC meeting .
Looking Ahead: Earnings and Economic Calendar
As the week progresses, investors will be closely watching earnings reports from other major companies, including:
– Ford (F): Reporting after the bell on Monday
– Advanced Micro Devices (AMD): Scheduled later in the week
– McDonald’s (MCD), Eli Lilly (LLY), ExxonMobil (XOM), and Starbucks (SBUX)
Market Outlook
As we move further into the week, market participants will be keenly focused on tech earnings and economic indicators. The performance of the “Magnificent Seven” could set the tone for the broader market, potentially pushing the S&P 500 to new heights. However, questions remain about the slowest earnings growth for tech mega-caps in six quarters and the sustainability of AI-driven investments .
With the U.S. presidential election just days away, political considerations may also begin to influence market sentiment. Investors should remain vigilant and prepared for potential volatility as these various factors converge in the coming days.
In conclusion, Monday’s positive market performance sets an optimistic tone for the week ahead. However, the true test lies in the upcoming earnings reports and economic data, which will provide clearer insights into the health of the U.S. economy and the direction of monetary policy.
