U.S. stocks edged higher on Monday as investors braced for a busy week filled with Big Tech earnings updates, Federal Reserve interest rate decisions and key U.S. jobs data.
The Dow Jones Industrial Average (^DJI) remained flat, while the S&P 500 (^GSPC) rose slightly, marking a subdued start after the major stock indexes posted weekly wins. The tech-heavy Nasdaq 100 (^NDX) rose 0.5%.
It's shaping up to be a tough week for stocks, with five of the Magnificent Seven tech companies scheduled to report earnings. Big Tech companies have driven the S&P 500's recent record rally, and the focus will be on whether their AI efforts and job cuts are paying off.
Microsoft (MSFT) and Alphabet (GOOGL, GOOG) lead the way on Tuesday, with Apple (AAPL), Amazon (AMZN) and Meta (META) among more than 100 companies named to vote.
At the same time, investors are bracing for the Fed's policy decision on Wednesday after last week's data showed slower inflation and a stronger economy. Policymakers are expected to keep interest rates on hold at 5.25%, but markets will listen closely to Powell's comments for clues as to when rate cuts will begin in the tapering of the March rate cut. It will tilt.
December U.S. jobs data will also be released on Friday, and will be factored into the Fed's calculations of whether it has achieved a “soft landing.”
read more: Impact of the Fed's interest rate hike suspension on bank accounts, CDs, loans, and credit cards
Meanwhile, the impending bankruptcy of real estate developer Evergrande (EGRNQ) has heightened concerns about the health of China's economy. A Hong Kong court ordered the heavily indebted company into liquidation, in what was seen as a milestone in the real estate crisis rocking the world's second-largest economy.
Oil prices fell on a combination of concerns about the impact on Chinese demand and supply risks from escalating tensions in the Middle East after drone attacks on US troops. US benchmark WTI futures (CL=F) traded below $78 per barrel, while global benchmark Brent futures (BZ=F) traded around $83 per barrel.
live7 updates
Sudden departure of key Goldman executives marks latest shakeup at banking giant
Another top Goldman Sachs (GS) executive is retiring.
Jim Esposito is stepping down after nearly 30 years as co-head of Goldman's global banking and markets division, according to a memo seen by Yahoo Finance. The Wall Street Journal first reported the resignation.
As Yahoo Finance's David Hollerith reports, Esposito's departure raises new questions about CEO David Solomon's succession battle and marks a high-profile management and board change for the Wall Street giant. This will bring the period to an end.
Please see here for the detail.
Warner Bros. Discovery stock falls due to analyst downgrade
Shares of Warner Bros. Discovery (WBD) fell as much as 3% on Monday after Wells Fargo downgraded the stock from overweight to equal weight, citing “risky earnings pricing” at the start of the year.
“We have thoroughly reviewed our 2024 WBD earnings forecast and are now more negative,” Wells Fargo analyst Steve Cahall said in a note to clients on Monday.
Read more from Allie Canal on Yahoo Finance here.
monday trend ticker
SoFi technology (Sophie)
SoFi stock rose as much as 22% after the fintech company reached a profit under Generally Accepted Accounting Principles (GAAP) for the first time since going public. SoFi's fourth quarter net income was $48 million, or $0.02 per share.
The company also reported its 11th consecutive quarter of record adjusted net revenue of $594 million.
Clarity (LCID)
The luxury electric car maker's stock rose as much as 21% on Monday, taking the No. 2 spot in Yahoo Finance's trend ticker slot.
The company is scheduled to announce its quarterly results on February 21st. Lucid stock has 0 Buy recommendations, 12 Hold recommendations, and 5 Sell recommendations from Wall Street analysts.
Short interest on the stock is just above 26% of its free float, making it susceptible to short selling.
The stock price has fallen about 24% since the beginning of the year.
I Robot (IRBT)
Shares in iRobot fell as much as 18% after the vacuum cleaner maker's sale to Amazon (AMZN) collapsed due to resistance from EU regulators, but the company pared some of its losses.
The companies said there is “no path forward for this transaction to receive regulatory approval.” On Monday, iRobot announced it would cut 31% of its workforce and that CEO Colin Angle would resign with immediate effect.
Why Big Tech earnings matter to the health of the market rally
The stock market rally is still about technology.
Big tech companies are expected to be the driving force behind fourth-quarter earnings growth in the S&P 500, according to new data from FactSet, as strategists look for more market upside.
As Yahoo Finance's Josh Schafer highlights, five of these companies are scheduled to report quarterly results this week: Apple, Alphabet, Microsoft, Amazon, and Meta.
Profits for Apple (AAPL), Alphabet (GOOGL, GOOG), Microsoft (MSFT), Amazon (AMZN), Meta (META), and Nvidia (NVDA) are expected to increase a combined 53.7% in the fourth quarter. Meanwhile, the other 494 companies in the S&P 500 index are expected to decline 10.5%.
Please see here for the detail.
Oil falls as China worries about escalating tensions in the Middle East
Oil futures fell on Monday, reversing earlier gains after Iranian-backed militants killed three US soldiers in Jordan over the weekend.
Oil prices fell after a Hong Kong court ordered Chinese real estate developer Evergrande to go into liquidation. The ruling determined that the company, once worth about $50 billion, was incapable of carrying out its restructuring plan.
West Texas Intermediate (CL=F) fell more than 1%, trading around $77 a barrel. Brent (BZ=F), the international standard price, also fell and was trading below $83 per barrel.
Oil prices rose more than 6% last week as traders assessed what broader escalating tensions in the Middle East meant for oil prices. Iran-backed Houthi rebels continue to target ships along the Red Sea coast, forcing cargo companies to delay or reroute shipments.
“While the attack attracted the attention of traders, there has been no substantial disruption to oil supply at this time,” Dennis Kistler, senior vice president at BOK Financial, said in a note Monday.
Tech stocks rise, energy slump
Major average stock prices remained stable on Monday morning as tech and consumer discretionary stocks rose while energy stocks lagged.
The Dow Jones Industrial Average (^DJI) and S&P 500 (^GSPC) rose above the flatline. The tech-heavy Nasdaq (^IXIC) also rose slightly.
Meta (META) hit an intraday high as Microsoft (MSFT) and Amazon (AMZN) rally ahead of this week's earnings release.
Meanwhile, the Energy Select Sector ETF (XLE) lagged, and shares of Chevron (CVX), ExxonMobil (XOM), and Occidental Petroleum (OXY) fell slightly.
Oil prices fell on Monday as concerns over the health of China's economy overshadowed concerns about escalating tensions in the Red Sea region.
West Texas Intermediate (CL=F) futures fell more than 1%, trading below $77 a barrel. Brent crude oil (BZ=F), the international standard price, has also fallen by more than 1% and remains at a level slightly above $82 per barrel.
Stocks little changed as tech companies start big earnings week
Stocks opened little changed as investors braced for a busy week with big tech company earnings, the Federal Reserve's interest rate decision and the January jobs report.
The Dow Jones Industrial Average (^DJI) and S&P 500 (^GSPC) hovered around the flatline after the major stock indexes posted weekly wins. The tech-heavy Nasdaq 100 (^NDX) rose slightly on Monday morning.
Amazon (AMZN) shares rose 0.4% after the e-commerce giant terminated its deal to acquire Roomba vacuum cleaner maker iRobot (IRBT). The companies said there is “no path forward for this transaction to receive regulatory approval.”
iRobot's stock price fell more than 16%. The company announced it would cut 31% of its workforce and that CEO Colin Angle would resign with immediate effect.
Tesla (TSLA) stock opened higher on Monday, rebounding from last week's plunge after the EV giant gave a bleak production outlook for 2024.
For the latest stock market news and in-depth analysis of price-moving events, click here.
Read the latest financial and business news from Yahoo Finance
