By US equities opened in green on Tuesday as investors weighed strong corporate earnings from several major firms against weaker results from others, while keeping a close eye on the Federal Reserve’s upcoming interest rate decision.
The benchmark S&P 500 index was up 0.22% to 6,403.91. The tech heavy Nasdaq also gained 0.58%, while the Dow Jones was only slightly up by 0.01%.
Shares of Boeing were down in red despite the aerospace giant delivered its most airplanes since 2018 and posted solid quarterly earnings.
Meanwhile, Procter & Gamble stock also fell even after a stronger-than-expected full-year revenue forecast, underscoring resilient consumer demand for the company’s household and personal care products.
With earnings season in full swing, 170 companies in the S&P 500 have now reported their quarterly results.
According to data from FactSet, more than 83% of those companies have exceeded Wall Street’s expectations.
However, some prominent names have missed the mark, including UPS, which reported weaker earnings and refrained from providing forward guidance, and Whirlpool, which fell short on both top- and bottom-line expectations for the second quarter.
Magnificent Seven set to report
The remainder of the week is shaping up to be a critical stretch for markets, as several of the so-called “Magnificent Seven” tech giants are scheduled to release earnings.
Meta Platforms, Microsoft, Apple, and Amazon will all report results on Wednesday and Thursday, making for a potentially volatile week in equity markets.
Ulrike Hoffmann-Burchardi, chief investment officer for the Americas and global head of equities at UBS Global Wealth Management, noted that “market sentiment could be tested in the coming days as investors brace for several major US data releases, the outcome of the Federal Reserve’s policy meeting, and second-quarter results from the bulk of the Magnificent 7 US tech companies.”
Traders are closely watching whether these mega-cap tech companies can maintain their momentum and deliver the strong growth expected of them.
Their performance could significantly influence broader market direction, especially given their outsized weighting in the major indexes.
Macroeconomic events in focus
Beyond earnings, investors are also bracing for several high-impact economic reports and a key monetary policy decision from the Federal Reserve.
The central bank is widely expected to hold benchmark interest rates steady when it announces its policy decision on Wednesday, though the accompanying statement and press conference will be parsed for clues about the direction of future rate changes.
The week’s economic calendar is packed. Wednesday will bring a reading on gross domestic product and private payroll data.
These reports, along with Friday’s highly anticipated July jobs report, will offer further insights into the strength of the US economy and the labor market.
Economists surveyed by Dow Jones expect nonfarm payrolls to show a gain of 100,000 jobs in July, down from 147,000 in June, with the unemployment rate ticking up to 4.2% from 4.1%.
Meanwhile, global trade developments remain on the radar. While investors largely brushed aside recent US-EU trade discussions, attention now turns to potential deals with China ahead of a tariff deadline this Friday.
US and Chinese officials held talks in Stockholm on Monday, raising hopes for progress.
Notable movers
Outside of the main market drivers, Novo Nordisk saw its US-listed shares tumble 21% after the pharmaceutical firm cut its full-year sales and profit guidance.
Whirlpool dropped 17% following its earnings miss, while Sarepta Therapeutics surged 20% after the FDA recommended lifting its voluntary hold on Elevidys for ambulatory patients.
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