(Bloomberg) — Markets settled into a holding pattern as the busiest week for US corporate earnings started moving into top gear, with the first of the “Magnificent Seven” big-tech giants — Google owner Alphabet Inc. — set to report on Tuesday.
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Investors are awaiting results from firms accounting for nearly 42% of the S&P 500’s market capitalization this week, including five of the seven tech megacaps which have powered this year’s rally. They’re also bracing for a raft of key economic data that will dictate Federal Reserve’s next interest-rate decision, as well as the US presidential election that is now just a week away.
The Stoxx Europe 600 index rose about 0.2%, while futures and the S&P 500 and Nasdaq 100 were little changed after Monday’s gains on Wall Street. Treasury yields slipped and a gauge of the dollar was flat. Oil steadied — after tumbling the most in more than two years on Monday — as the market focused on easing tensions in the Middle East.
“Near-term focus is shifting to megacap earnings that kick off today with Google,” said Charu Chanana, chief investment strategist at Saxo Markets. “There is still an expectation that AI spending will be maintained and that could continue to be a significant driver of broader equity momentum.”
Markets are positioning for the prospect of Donald Trump returning to the White House, with most major polls showing him locked in a tight race with Vice President Kamala Harris. Crypto companies surged, and Bitcoin rose past $71,000 for the first time since June, as the former president is seen as supportive of the digital tokens.
A victory for Trump would be more beneficial for stocks and Bitcoin relative to his Democratic opponent, while a Harris presidency would bring slightly more relief in housing costs, according to a Bloomberg Markets Live Pulse survey. Some 38% of respondents see equities accelerating a year from now under the Republican candidate, versus 13% under the Democrat.
Trump’s chances of a victory are increasing and “that’s seen as good for US stocks in the short run,” said Phillip Wool, head of portfolio management at Rayliant Global Advisors. “Deficits will increase, inflation will come back, and it could slow Fed rate cuts. All of this would put upward pressure on the dollar,” he said.
Meanwhile, just days before Fed policy makers gather to reflect on the appropriate tempo of rate cuts, data is set to show underlying resilience in the US economy and a temporary hiccup in jobs growth.
Among individual stock moves in Europe, HSBC Holdings Plc led banking stocks higher after announcing a multibillion-dollar stock buyback as it reported better-than-estimated earnings. Novartis AG declined after an earnings beat, with analysts disappointed by a lack of clarity on the drugmaker’s outlook for 2025.
Benchmark gauges in Tokyo, Australia, Hong Kong and South Korea climbed, while stocks in China retreated.
In currency markets, the yen strengthened after Japanese Prime Minister Shigeru Ishiba promised to restore political stability in a bid to maintain power, following his ruling coalition’s failure to win a majority in the lower house.
Traders are also awaiting a BOJ policy decision which is due later this week. Data showed that Japan’s labor market tightened in September, indicating sustained pressure on companies to raise wages ahead of the BOJ meeting.
Key events this week:
US job openings, Conference Board consumer confidence, Tuesday
Alphabet earnings, Tuesday
Eurozone consumer confidence, GDP, Wednesday
US GDP, ADP employment, pending home sales, Wednesday
Meta Platforms, Microsoft earnings, Wednesday
US Treasury Department holds quarterly refunding announcement of bond-auction plans, Wednesday
China Manufacturing and non-manufacturing PMI, Thursday
Bank of Japan rate decision, Thursday
Eurozone CPI, unemployment, Thursday
US personal income, spending and PCE inflation data, initial jobless claims, Thursday
Amazon, Apple earnings, Thursday
China Caixin manufacturing PMI, Friday
US employment, ISM manufacturing, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.2% as of 8:14 a.m. London time
S&P 500 futures were little changed
Nasdaq 100 futures were little changed
Futures on the Dow Jones Industrial Average were little changed
The MSCI Asia Pacific Index rose 0.1%
The MSCI Emerging Markets Index fell 0.3%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0815
The Japanese yen was little changed at 153.23 per dollar
The offshore yuan fell 0.2% to 7.1612 per dollar
The British pound was little changed at $1.2979
Cryptocurrencies
Bitcoin rose 2% to $70,974.12
Ether rose 4% to $2,616.27
Bonds
The yield on 10-year Treasuries was little changed at 4.29%
Germany’s 10-year yield advanced two basis points to 2.30%
Britain’s 10-year yield advanced two basis points to 4.27%
Commodities
Brent crude rose 0.5% to $71.75 a barrel
Spot gold rose 0.3% to $2,751.22 an ounce
This story was produced with the assistance of Bloomberg Automation.
