Stock Futures Increase, As Earnings Season Moves Beyond Banks

Stock Futures Increase, As Earnings Season Moves Beyond Banks
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As investors awaited new earnings reports to provide information on the state of the economy, U.S. stock futures started to rise.

S&P 500 futures increased by 0.3% on Tuesday. Futures for the Dow Jones Industrial Average increased 0.2 percent, while contracts for the tech-focused Nasdaq-100 gained 0.3 percent. On Monday, U.S. stocks declined.

Investors are analyzing earnings for clues about how businesses and consumer spending are being affected by the long-term high inflation rate. The likelihood of a U.S. recession within the next year has increased, according to economists, who are concerned that slowing growth will result from raising interest rates to combat inflation. Now, attention is being paid to how businesses are responding to these expectations, especially if they intend to reduce hiring or other investments.

Luca Paolini, chief strategist at Pictet Asset Management, declared that “if the corporate sector starts to cut back on investment spending, that to me is the nail in the coffin.”

Johnson & Johnson, Halliburton, and Lockheed Martin are all scheduled to report earnings before the market opens. After the market close, Netflix will release its report. Some tech firms have already reduced hiring or made job cuts.

International Business Machines saw a 5% decline in premarket trading after announcing that the closure of its operations in Russia and a strong dollar had a negative impact on its quarterly results.

The yield on the standard 10-year Treasury note increased slightly on bond markets, rising to 2.995 percent from 2.959 percent on Monday. Prices and yields follow opposite trends.

Brent crude, the global standard for oil prices, increased 0.1 percent to $106.35 a barrel on the energy markets.

The euro, which last week reached parity with the dollar, increased 1% to $1.0248. The WSJ Dollar Index, which compares the value of the dollar to a basket of 16 different currencies, decreased by 0.7 percent. As investors have sought refuge from falling stock prices and placed bets on the durability of the U.S. economy, the dollar has risen against other currencies this year.

At its meeting on Thursday, the European Central Bank is anticipated to raise interest rates for the first time in 11 years. Currency strength is typically a result of interest rate increases because investors are being paid more to hold those assets.

The Stoxx Europe 600 index fell 0.6 percent internationally. After the French government announced Tuesday that it plans to pay about 9.7 billion euros, or $9.84 billion, to take full control of the energy company, shares of Electricite de France increased by 15% in trading in Paris.

Major Asian indexes end the day with mixed results. China’s Shanghai Composite remained unchanged, while Japan’s Nikkei 225 increased by nearly 0.7 percent. Hong Kong’s Hang Seng dropped 0.9 percent, and South Korea’s Kospi dipped by 0.2 percent.

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