US stock futures started the week lower after closing the markets higher on Friday. S&P 500 futures, as well as Dow Jones futures, edged lower on Monday. Nasdaq 100 futures were at a standstill.
US Markets Outlook
S&P 500 index is set to start the week lower ahead of the first major earnings reports for the second quarter later in the week. Investors are looking ahead of the earnings report, especially by the big banks. They are hoping to get clues on whether corporate profitability can support equity valuations.
Investors’ focus will be on financial company earnings. Goldman Sachs as well as JPMorgan are expected to release their earnings report on Tuesday. Bank of America, Black Rock, and Citigroup will release their report on Wednesday while Morgan Stanley is due on Thursday.
US treasury yields inched lower ahead of the opening of the markets. The yield on the benchmark 10-year Treasury note slipped to 1.334%. The yield on the 30-year Treasury bond fell to 1.954%.
The drop in treasury yields has weighed heavily on markets about a slowdown in growth. Investors have also raised concerns o the Delta variant which has the markets worried. Many seem to think that the variant would cause hiccups in the markets.
John Roe, head of multiasset funds at Legal & General Investment Management stated that,
“Sentiment in equities remains bullish, but the Delta variant is a headwind for that. There’s an ongoing concern, what if reopening is difficult to do?”
S&P 500 index will react to the US Consumer Price Index (CPI) for June on Tuesday. Fed Chair, Jerome Powell is expected to appear before the US House and Senate on Wednesday and Thursday. He is expected to present his semiannual monetary policy report.
Virgin Galactic was among the best performers in pre-market trading. The spaceflight company gained more than 8.13% in its stock earnings. This was after the company’s successful space flight during the weekend. The company’s founder, Richard Branson was among the crew members who flew to space.
Didi’s stocks dipped more than 3.91% in premarket trade. The Cyberspace Administration of China (CAC) banned Didi, the biggest ride-hailing service in China. The CAC also banned the company’s 25 other apps accusing them of violating laws around collecting and using personal information.
Carnival Corp was in red in premarket trade. The tour operator company previously announced a tender offer for 11.5% of its senior secured notes due 2023. The company’s shares dipped 1.48%.