U.S. stock-index futures moved lower as investors returned from the holiday weekend in cautious mood ahead of earnings reports that will shed light on the health of the consumer and crucial results from AI-darling Nvidia.
How are stock-index futures trading
-
S&P 500 futures
ES00,
-0.29%
dipped xxx points, or xx% to xxxx -
Dow Jones Industrial Average futures
YM00,
-0.16%
fell xxx points, or xx% to xxxx -
Nasdaq 100 futures
NQ00,
-0.44%
eased xx points, or xx% to xxxx
On Friday, the Dow Jones Industrial Average
DJIA
fell 145 points, or 0.37%, to 38628, the S&P 500
SPX
declined 24 points, or 0.48%, to 5006, and the Nasdaq Composite
COMP
dropped 131 points, or 0.82%, to 15776. The stock market was closed on Monday for Presidents’ Day.
What’s driving markets
News of a $35 billion credit card merger and softness in Treasury yields were positive factors early Tuesday, but a holiday-shortened week that is full of potential catalysts was nevertheless starting on a muted note.
The first issue for investors to consider are the earnings on Tuesday of big retailers Walmart
WMT,
and Home Depot
HD,
which may give clues to the confidence of U.S. households, a crucial sentiment-gauge given consumption accounts for roughly 70% of the economy.
Other companies revealing results on Tuesday before the opening bell include KBR
KBR,
Medtronic
MDT,
and LGI Homes
LGIH,
followed after the close by Palo Alto Networks
PANW,
Toll Brothers
TOL,
Teladoc Health
TDOC,
and Matterport
MTTR,
Then Wednesday at 2 p.m. Eastern sees the release of the Federal Reserve’s minutes from its January 31 meeting, from which traders will try to glean any fresh guidance to the likely timing of interest rate cuts.
Andrew Hollenhorst, economist at Citi, said the minutes will likely follow recent Fed speakers in suggesting that the Fed will lower interest rates this year but only ‘carefully’ once officials have ‘greater confidence’ that inflation is durably slowing towards 2%.
“Most interesting might be any details of the winding down of balance sheet reduction. An ‘in-depth’ discussion on the balance sheet is scheduled for March,” said Hollenhorst.
Last, but definitely not least, Nvidia
NVDA,
will release its earnings after Wednesday’s market close, with investors aware that the reception afforded the AI-chipmaker may determine broader market sentiment for a while. A 2% fall for Nvidia shares in premarket trading was pressuring S&P 500 and Nasdaq index futures.
“With a year-to-date gain of 50% already and a market cap of $1.8 trillion, Nvidia has a lot to live up when it reports numbers this week,” said Bespoke Investment Group.
Kathleen Brooks, analysts at XTB concurred: “Unsurprisingly, there are big expectations for Nvidia, and if they fail to deliver this could be a major upset to the S&P 500, as the top five stocks in the U.S. blue chip index have fueled 75% of its gains so far in 2024.”
U.S. economic updates set for release on Tuesday include the leading economic indicators for January, due at 10 a.m. Eastern.
News that Beijing has trimmed mortgage costs by more than expected has done little to brighten the mood, as traders note a muted response in Chinese stocks amid concerns more must be done to revive the world’s second biggest economy.
