Futures signal more steam in S&P 500 after record high
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[January 22, 2024] (Reuters)
- U.S. stock index futures rose on Monday, indicating further momentum
in the S&P 500 after chip and megacap stocks drove the benchmark index
to a record high last week, while corporate earnings and clues on rate
cuts continued to top investors' radar.
After the prior year's stellar run, Wall Street's main indexes stalled
at the start of 2024 as investors scaled back expectations of U.S.
interest-rate cuts commencing as early as March, in light of mixed
economic data and Federal Reserve policymakers playing down such bets.
A rally in chip stocks following bullish forecasts from Taiwan's TSMC
and Super Micro Computer last week, and heavyweight technology stocks
steered the S&P 500 to a record high of 4,842.07 points and an all-time
closing high of 4,839.81 points on Friday, confirming a bull market
since its October 2022 closing low.
The Philadelphia SE Semiconductor index and the S&P 500 information
technology index have jumped nearly 5% so far in January, among the top
sectoral gainers, hitting all-time highs last week.
Nvidia and Advanced Micro Devices gained 0.7% and 0.8%, respectively, in
premarket trading, after hitting their highest levels on Friday, while
Marvell Technology, Qualcomm and Micron Technology climbed around 1%
each.
Megacaps Alphabet, Meta Platforms and Tesla also gained between 0.8% and
1.2%.
Meanwhile, big-ticket earnings later this week from Netflix, Tesla,
Abbott Laboratories, Intel and Johnson & Johnson, among others, will be
keenly watched for insights into the health of corporate America.
United Airlines Holdings and Zions Bancorp are set to detail their
earnings after market close.
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A trader works on the floor at the New York Stock Exchange (NYSE) in
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So far, 84.6% of the S&P 500 companies that have reported results
have surpassed earnings expectations, LSEG data showed on Friday,
compared with the 93.1% beat seen in the first week of the earnings
season.
On the economic data front this week, personal consumption
expenditure (PCE)- the Fed's preferred inflation gauge, S&P Global
PMI readings and an advance fourth-quarter GDP print will be crucial
in assessing the U.S. central bank's next policy decision when it
meets next week.
Traders have sharply pared bets of an at least 25-basis-point rate
cut in March, currently standing at 44%, according to the CME
Group's FedWatch Tool, from the over 80% chances seen by 2023-end.
At 5:46 a.m. ET, Dow e-minis were up 49 points, or 0.13%, S&P 500
e-minis were up 14.5 points, or 0.3%, and Nasdaq 100 e-minis were up
97.25 points, or 0.56%.
Among others, Boeing lost 2.5% after the U.S. Federal Aviation
Administration recommended airlines operating the company's
737-900ER jets inspect door plugs to ensure they are properly
secured.
Renewable energy firm SolarEdge gained 6.8% on plans to lay off
about 16% of its global workforce.
(Reporting by Ankika Biswas in Bengaluru; Editing by Maju Samuel)
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