US Equity Futures Remain Steady as Alphabet Leads Tech Higher
US equity futures are stable, reversing slight overnight gains ahead of the next batch of earnings. As of 8:00am ET, S&P futures were flat while Nasdaq 100 futures are up 0.1%. Alphabet was the second of the Mag7 to beat earnings, and the stock is up 5.4% pre-market after beating across the board on strong cloud growth. Amazon, Meta, and Microsoft are all trading up at least 1.7% pre-market. Semiconductors are lower with AMD down 8.5% and Nvidia down 80bps. Bond yields are lower as the curve bull steepens ahead of ADP numbers and US Q3 GDP/Price releases. The dollar snapped a three-day advance, and the commodity bid returned led by Energy. Meta and Microsoft are the next Mag7 earnings today. Today's macro US economic data calendar includes October ADP employment change (8:15am), 3Q advance GDP (8:30am) and September pending home sales (10am).
Alphabet Gains 6% in Premarket Trading
In premarket trading, Alphabet gains 6%, showing an expensive foray into artificial intelligence is starting to pay off, delivering better-than-expected sales for its cloud-computing business. On the other end, AMD tumbled 8% after the chipmaker’s revenue outlook fell below Wall Street’s expectations, signaling that its artificial intelligence sales are growing slower than some had anticipated. Eli Lilly tumbled 11% after the Mounjaro and Zepound maker lowered its full-year guidance as sales of its blockbuster weight-loss drug fell short of expectations, which the company blamed on inventory issues. Qorvo, whose biggest customer is Apple, tumbled 19% after forecasting revenue and profit far short of estimates.
Investors Focus on High-Profile Reports in the US
Just about a week away from the Fed’s decision, and less than a week from the presidential election, investors are turning their focus to three high-profile reports in the US that look set to show underlying resilience in the economy and a temporary hiccup in job growth. They’re also positioning for a too-close-to-call US presidential election on Nov. 5.
“The mood in the market today feels more like the calm before the next storm,” said Hebe Chen, a market analyst at IG Markets Ltd. “Traders are on edge, bracing for the incoming tide of uncertainties from multiple sources,” including the US election and major tech earnings.
European Stocks Decline on Another Day Packed with Earnings Reports
European stocks decline on another day packed with earnings reports, with all eyes on the UK budget later Wednesday. The euro area’s economy expanded more strongly than expected in the third quarter, data showed Wednesday — with even Germany avoiding the recession it was widely tipped to endure. A measure of economic confidence, however, unexpectedly declined. The Stoxx 600 fell 1% to 512.4 with all 20 sectors in the red but consumer and technology sectors were the worst performers.
Asian Equities Traded in a Narrow Range
A key gauge of Asian equities traded in a narrow range, as gains in Japan were countered by losses in Chinese markets. The MSCI Asia Pacific Index slipped 0.1%, erasing an earlier rise of as much as 0.4%. Japanese benchmarks led gains as tech shares tracked advances in their US peers. Local exporters are also expected to benefit from the continued weakness in the yen, while an improved outlook for nuclear power is supporting utility shares. The Bank of Japan is widely expected to stand pat Thursday, having paused its path toward higher interest rates. Key gauges in Hong Kong and mainland China dropped on continued volatility as traders await more decisive moves from Beijing to support the ailing economy and markets.
Bottom Line
The US equity futures remain steady as Alphabet leads tech higher, and gold hits a new record. The market mood today feels more like the calm before the next storm, with traders on edge, bracing for the incoming tide of uncertainties from multiple sources, including the US election and major tech earnings. European stocks decline on another day packed with earnings reports, and all eyes are on the UK budget. A key gauge of Asian equities traded in a narrow range, as gains in Japan were countered by losses in Chinese markets.
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