Equity futures are higher ahead of big bank earnings
Stock futures ticked up on Friday as investors turned their attention to big bank earnings after the major averages staged a historic turnaround.
Futures tied to the Dow Jones Industrial Average rose 110 points, or 0.37%. S&P 500 futures rose 0.3%, and Nasdaq 100 futures rose 0.2%.
JPMorgan Chase, Wells Fargo, Morgan Stanley and Citigroup are all due to report before the bell.
Dow member UnitedHealth also posted quarterly results Friday, with earnings and revenue beating expectations. UnitedHealth shares ticked up 0.8%.
The reports come the day after the market made a massive comeback. The Dow ended Thursday’s session at 827 points after falling more than 500 points to start the day. The S&P 500 rose 2.6% to snap a six-day losing streak, and the Nasdaq Composite jumped 2.2%.
The moves followed the release of the consumer price index, a key US inflation reading, which was warmer than expected for the month of September. Initially, this weighed on markets as investors prepared for the Federal Reserve to continue with its aggressive rate hike plan. However, they later retracted these concerns.
“The best excuse for today’s bounce is ‘sell the news’ coupled with very negative sentiment/positioning,” said Ross Mayfield, investment strategy analyst at Baird. not the short-term path of the Fed (which was already quite hawkish).”
Still, persistent inflation remains a problem for the Fed and for investors’ concerns about the central bank’s policy tightening.
“The turnaround is a welcome respite for investors, but the market still requires greater clarity about the extent of tightening that remains ahead,” said Brian Levitt, global market strategist at Invesco. “The focus remains on the pace of inflation and the underlying strength of the labor market. A market rally is likely to start when the market believes that a Fed tightening pause is in the offing.”
There is still more economic data this week as well. September’s retail sales come out at 8:30 a.m. ET. Later in the morning, investors look forward to the latest consumer sentiment figures from the University of Michigan.
