S&P 500 futures hover near record ahead of pivotal week of tech earnings

Friday marked the fifth record close this year for the Dow Jones Industrial Average, with the S&P 500 finishing only a tenth below its all-time high.

What’s driving markets

It’s a huge week for earnings with results due out of Microsoft
MSFT,
-0.23%,
Apple
AAPL,
-0.90%,
Alphabet
GOOGL,
+0.21%,
Amazon
AMZN,
+0.87%
and Meta Platforms
META,
+0.24%,
in a week that also includes a Fed interest-rate decision, jobs market data and the Treasury’s quarterly refunding.

“For a data dependent Fed, and one that still needs to reclaim its inflation fighting credibility, the likely response will be to continue to guide away from a March rate cut, but also remind us the Fed will be willing to act if need be—i.e., retain optionality,” said Richard de Chazal, a macro analyst at William Blair. “We should also expect to get a little more flesh on the bone with regard to the timing of the [quantitative tightening] tapering program.”

De Chazal added that earnings so far haven’t been too impressive — earnings for the 124 S&P 500 companies that have reported so far are up 2.3% vs. expectations of a 1.2% increase, which is below the average gap of 4.4 percentage points.

There’s also geopolitical worries after an attack killed three U.S. soldiers and injured 34 more in Jordan. Oil futures
CL00,
+0.26%
were trading under $78 a barrel, while gold
GC00,
+0.40%
rose and the yield on the 10-year Treasury
BX:TMUBMUSD10Y
fell. Yields move in the opposite direction to prices.