The facade of the New York Stock Exchange (NYSE) is on display in New York, USA, February 16, 2021. REUTERS / Brendan McDermid
Futures pointed to a lower opening for Wall Street’s major indices on Tuesday as investors this week used the results of Netflix and other major technology-related companies to support the positive start to the earnings season.
Streaming service provider Netflix (NFLX.O), which thrived during last year’s lockdowns, will be the first of the so-called FAANG group to report quarterly figures. Its shares fell about 0.3% in pre-market trading, ahead of the results after the markets closed.
International Business Machines Corp (IBM.N) was up 2.7% as it recorded the largest quarterly revenue increase in more than two years, boosted by its betting on the high margin cloud computing business. read more
Chipmaker Intel Corp (INTC.O) will report the results on Thursday.
“We’re getting a little bit of weakness … even though earnings and economic data are good,” said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, North Carolina.
“The underlying fundamentals are extraordinarily strong and it wouldn’t be too worrying after the rally we’ve seen over the past 13 months if the market takes a bit more of a breath from strong gains.”
Following blockbuster earnings from major US banks last week, analysts expect first-quarter earnings of total S&P 500 companies to increase 30.9% from a year earlier, according to data from Refinitiv IBES.
A decline in long-term bond yields from a 14-month high has allayed concerns about higher borrowing costs, driving demand for rich technology stocks. read more
Also, a string of robust economic data and expectations of a strong corporate earnings recovery helped the S&P 500 and Dow hit record highs last week.
At 8:32 a.m.ET, the Dow E-minis scored 154 points or 0.45%, S&P 500 E-minis 18 points or 0.43%, and Nasdaq 100 E-minis scored 48.75 points or 0.35%.
Tobacco companies, including Altria Group (MO.N) and Philip Morris (PM.N), fell as much as 4.2% after the Wall Street Journal reported that the Biden government is considering a rule that would limit nicotine or ban menthol in cigarettes .
Abbott Laboratories (ABT.N) was down 3%, despite a three-fold jump in quarterly profit. read more
Nike Inc (NKE.N) fell about 1.6% after Citigroup downgraded its stock rating from “buy” to “neutral”.
Our Standards: Thomson Reuters Principles of Trust.