S&P 500 climbs toward record, marquee reports in focus

S&P 500 climbs toward record, marquee reports in focus

U.S. stock index futures rose slightly on Monday as investors geared up for a busy week of corporate earnings, with results from major companies including Facebook and Amazon on tap.

Traders work on the floor at the NYSE in New York
Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., July 16, 2019. REUTERS/Brendan McDermid

REUTERS: The S&P 500 climbed toward a record high on Monday, supported by expectations of lower interest rates, while investors awaited quarterly earnings from marquee companies Facebook, Alphabet and Amazon later this week.

Facebook Inc rose 1.6per cent ahead of its report after the bell on Wednesday, while Amazon.com Inc and Google-parent Alphabet Inc were each up about 0.5per cent ahead of their reports on Thursday.

Investors' reactions to the reports of those top-tier growth companies could affect broader market sentiment as the S&P 500 trades about 1per cent below its July 15 record high close.

"How is that going to affect my other tech holdings and the market overall? That is more worrying than my actual investment in Alphabet," said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.

The technology index rose 1.2per cent, the most among the S&P sectors, while the Philadelphia chip index surged 2per cent.

Shares of Boeing Co fell 1per cent and pressured the blue-chip Dow index after ratings agency Fitch revised its outlook on the planemaker to "negative" from "stable," while the tech-heavy Nasdaq was lifted by chipmakers.

The European Central Bank meets on Thursday and money markets are pricing in a more than 50per cent chance of a 10 basis point cut in interest rates. Federal Reserve officials are set to meet a few days later, when they are widely expected to lower rates by at least 25 basis points.

Hopes of an interest rate cut have helped Wall Street's main indexes hit record levels this month, recovering from a slump in May caused by a sudden escalation of U.S.-China trade tensions.

About 30per cent of S&P 500 companies are set to report second-quarter results this week, with overall profits now estimated to rise about 1per cent, according to Refinitiv IBES data.

Chip stocks gained on news that White House economic adviser Larry Kudlow will host a meeting with executives of semiconductor and software companies on Monday to discuss a U.S. ban on sales to China's Huawei Technologies.

At 2:34 pm ET, the Dow Jones Industrial Average was up 0.01per cent at 27,157.14 points, while the S&P 500 gained 0.28per cent to 2,984.97.

The Nasdaq Composite added 0.68per cent to 8,201.64.

Second-quarter earnings have been mixed so far, with major banks raising concerns about profit growth in a low interest rate environment. Microsoft Corp and International Business Machines , on the other hand, have reported better-than-expected earnings.

Halliburton Co surged 8per cent, the most among S&P 500 companies, after the oilfield services provider's second-quarter profit beat analysts' estimates.

Advancing issues outnumbered declining ones on the NYSE by a 1.03-to-1 ratio; on Nasdaq, a 1.11-to-1 ratio favored decliners.

The S&P 500 posted six new 52-week highs and five new lows; the Nasdaq Composite recorded 45 new highs and 105 new lows.

(Additional reporting by Amy Caren Daniel and Karina Dsouza in Bengaluru; Editing by Chris Reese)

Source: Reuters