A trader works on the floor of the New York Stock Exchange (NYSE) in New York City, September 6, 2022.
Brendan McDiarmid | Reuters
US stock futures fell slightly on Tuesday morning as third-quarter earnings season gained momentum.
Linked futures contracts Dow Jones Industrial Average He lost 46 points, or 0.13%. Standard & Poor’s 500 Futures fell by 0.13%. Nasdaq 100 Futures also fell by 0.12%.
All major averages closed in the green during the main trading session on Monday. Despite rising Treasury yields — which typically puts downward pressure on stocks — stocks posted gains as investors became optimistic about corporate earnings. The yield on 10-year US Treasury bonds rose 7 basis points to 4.7% on Monday. However, the yield on the 10-year Treasury note remains more than 10 basis points below its 16-year highs earlier in the month. Small stocks also rose on Monday, with the Russell 2000 rising 1.6%.
Fifty-three companies in the S&P 500, or about 11% of the index, are scheduled to report results this week. Five names in the Dow Jones Index will also release their results. Key reports Tuesday morning include Johnson & Johnson, Bank of America, Goldman Sachs and Lockheed Martin.
“If the economy is going to accelerate again, which it is, and if earnings growth is going to accelerate again, which it is doing, small businesses have to lead the way. That’s what history says,” said Richard Bernstein, CEO. From my advisor, Richard Bernstein, on CNBC’s “Closing Bell: Overtime” on Monday. “So I think there’s a little bit of rationality, going back to the stock market, and that market is starting to expand a little bit.”
Several financial names got earnings season off to a strong start, including Charles Schwab on Monday and JPMorgan Chase on Friday. This helped improve market sentiment amid concerns surrounding the war between Israel and Hamas. The conflict in the Middle East has raised concerns that tensions in the region could escalate to some of the largest oil producers, particularly Iran.
Gloomy geopolitical concerns and inflation concerns have added to market negativity, “but it’s also a wall of anxiety about rising stock prices,” said George Ball, Chairman of Sanders Morris Harris.
In addition to Tuesday’s earnings reports, Wall Street will also be anticipating new economic data. Retail sales and industrial production data for September will be published before the bell. October housing market index numbers and business leaders’ survey numbers are also scheduled to be released on Tuesday morning.
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