Choppy Trading May Persist On Wall Street Ahead Of Earnings, Economic News

The major U.S. index futures are currently pointing to a roughly flat open on Monday, with stocks likely to extend the lackluster performance seen last Friday.

Traders may remain reluctant to make significant moves ahead of the release of earnings news from several big name companies in the coming days.

Tech giants Alphabet (GOOGL), Amazon (AMZN), Intel (INTC), Meta Platforms (MET) and Microsoft (MSFT) are among a slew of well-known companies due to report their quarterly results this week.

A lack of major U.S. economic data may also keep some traders on the sidelines ahead of the release of several key reports.

Reports on consumer confidence, new home sales, durable goods orders, first quarter GDP and personal income and spending are likely to attract attention in the coming days.

The personal income and spending report includes a reading on inflation said to be preferred by the Federal Reserve and could impact the outlook for interest rates ahead of the Fed meeting next week.

Meanwhile, shares of Coca-Cola (KO) are seeing pre-market strength after the beverage giant reported first quarter earnings that exceeded analyst estimates.

After ending Thursday’s session mostly lower, stocks showed a lack of direction throughout the trading day on Friday. The major averages spent the day bouncing back and forth across the unchanged line.

The major averages eventually ended the session slightly higher. The Dow crept up 22.34 points or 0.1 percent to 33,808.96, the Nasdaq edged up 12.90 points or 0.1 percent to 12,072.46 and the S&P 500 inched up 3.73 points or 0.1 percent to 4,133.52.

Despite the uptick on the day, the major averages moved modestly lower for the week. While the S&P 500 edged down by 0.1 percent, the Dow slipped by 0.2 percent and the Nasdaq fell by 0.4 percent.

The choppy trading on Wall Street came as traders seemed reluctant to make significant moves as they look for additional clarity about the outlook for the markets following the volatility seen in recent session.

Traders may also have been looking ahead to several key economic reports due be released this week, including the Commerce Department’s report on personal income and spending.

Amid a relatively quiet day on the economic front, S&P Global released data indicating a faster rise in business activity at U.S.-based firms on the month of April.

The headline S&P Global Flash U.S. PMI Composite Output Index climbed to 53.5 in April from 52.3 in March, signaling the quickest upturn in business activity since May 2022. Economists had expected the index to inch up to 52.8.

The report also said the Flash U.S. Services Business Activity also rose to a twelve-month high of 53.7 in April from 52.6 in March, while the Flash U.S. Manufacturing PMI crept up to 50.4 from 49.2, signaling the first improvement in operating conditions at goods producers in six months.

The uptick by the Dow partly reflected a notable advance by shares of Procter & Gamble (PG), with the consumer products giant surging by 3.5 percent.

Procter & Gamble jumped after reporting better than expected fiscal third quarter results and raising its full-year sales guidance on higher prices.

Pharmaceutical stocks showed a strong move to the upside on the day, driving the NYSE Arca Pharmaceutical Index up by 1.4 percent to a record closing high.

Notable strength was also visible among retail stocks, as reflected by the 1.3 percent gain posted by the Dow Jones U.S. Retail Index.

On the other hand, steel stocks moved sharply lower over the course of the session, dragging the NYSE Arca Steel Index down by 2.4 percent.

Oil service stocks also saw considerable weakness despite an increase in by the price of crude oil, resulting in a 1.8 percent slump the Philadelphia Oil Service Index.

Banking stocks also showed a notable move to the downside on the day, with the KBW Bank Index falling by 1.5 percent.

Commodity, Currency Markets

Crude oil futures are slipping $0.28 to $77.59 a barrel after climbing $0.50 to $77.87 a barrel last Friday. Meanwhile, after plunging $28.60 to $1,990.50 an ounce in the previous session, gold futures are inching up $3.60 to $1,994.10 an ounce.

On the currency front, the U.S. dollar is trading at 134.58 yen versus the 134.16 yen it fetched at the close of New York trading on Friday. Against the euro, the dollar is trading at $1.1007 compared to last Friday’s $1.0986.

Asia

Asian stocks ended mostly lower on Monday as focus shifted to central bank meetings and U.S. corporate earnings. Microsoft, Alphabet, Amazon and Meta Platforms all are slated to report their earnings this week.

Gold prices were subdued for a second consecutive session and the dollar held steady as investors braced for the Fed, BoE and ECB policy meetings due over the next two weeks.

Oil prices fell over 1 percent to extend last week’s steep losses as fears of a global economic downturn exacerbated demand concerns.

Chinese shares fell notably on lingering concerns over an economic recovery this year. The benchmark Shanghai Composite Index dropped 0.8 percent to 3,275.41.

Hong Kong’s Hang Seng Index closed 0.6 percent lower at 19,959.94 as investors reacted to hawkish signals from Federal Reserve officials to curb inflation.

Japanese shares ended slightly higher as investors looked ahead to this week’s Bank of Japan policy meeting – the first under new Governor Kazuo Ueda.

The central bank is widely expected to maintain its ultra-dovish stance but could guide the market by indicating tightening later in the year to control sticky inflation.

The Nikkei 225 Index ended 0.1 percent higher at 28,593.52, rimming early gains. The broader Topix closed 0.1 percent higher at 2,037.34.

Airline stocks surged, with ANA Holdings rallying 3.7 percent and Japan Airlines adding 2 percent. Electric motor maker Nidec rose 1.1 percent before announcing its first quarterly operating loss in a decade.

Shippers and chip-related stocks lost ground, with Kawasaki Kisen Kaisha ending down nearly 4 percent, Advantest losing 2.3 percent and Tokyo Electron falling 1.9 percent.

Seoul stocks declined for a third straight session ahead of Q1 GDP data due Tuesday, which is expected to show a slowdown in growth amid continued headwinds from weak exports. The Kospi fell 0.8 percent to 2,523.50, dragged down by large-cap tech stocks.

Samsung Electronics shed 0.8 percent and SK Hynix lost 2.1 percent on reports that the U.S. has asked South Korea to urge its chipmakers not to boost sales to China if Beijing bans Micron Technology from selling chips.

Australian markets finished marginally lower ahead of first-quarter inflation data due later this week and a Reserve Bank meeting next week.

The benchmark S&P/ASX 200 Index slipped 0.1 percent to 7,322, dragged down by miners. The broader All Ordinaries Index closed 0.1 percent lower at 7,512.20.

Fortescue Metals Group tumbled 3.4 percent after posting iron ore shipments in the March quarter that were little changed from the prior year period. Heavyweight BHP gave up 1.9 percent and Rio Tinto declined 3.3 percent.

Diversified miner South32 slumped 7.4 percent after downgrading full-year output guidance at some operations.

Across the Tasman, New Zealand’s benchmark S&P/NZX 50 Index climbed 0.8 percent to finish at 12,026.39.

Europe

European stocks are flat to slightly lower in cautious trading on Monday as investors await earnings from big tech companies including Alphabet, Microsoft, Amazon and Meta this week for directional cues.

Traders also await a reading on U.S. first-quarter GDP along with the Fed’s favored measure of inflation for further clues on the health of the world’s largest economy.

Closer to home, investors ignored survey results showing that a measure of German business sentiment improved for a sixth consecutive month in April.

The headline German IFO business climate index rose to 93.6 in April from 93.2 in March. Economists expected the reading to edge up to 94.

Elsewhere, U.K. house price growth eased in April, Rightmove said in a report. On a monthly basis, average asking prices rose by 0.2 percent, down from 0.8 percent growth in March and the average of 1.2 percent growth at this time of year.

While the German DAX Index is up by 0.1 percent, the French CAC 40 Index is just below the unchanged line and the U.K.’s FTSE 100 Index is down by 0.1 percent.

Credit Suisse has rallied. The Swiss lender reported over 61 billion Swiss francs (over USD 68 billion) in net asset outflows in the first quarter.

Investment bank UBS Group has also shown a strong move to the upside after it hired Oliver Wyman to guide the integration of Credit Suisse.

Dutch health tech firm Philips has also jumped after setting aside 575 million euros ($631 million) for possible litigation costs related to its global recall of respiratory machines.

Software AG has soared nearly 50 percent after the software developer said it would accept a takeover bid by private equity firm Silver Lake.

Meanwhile, French media group Vivendi has fallen after it entered into a put option agreement with International Media Invest for the sale of publishing business Editis.

U.S. Economic Reports

No major U.S. economic data is scheduled to be released today.

Stocks In Focus

Shares of Bed Bath & Beyond (BBBY) are plunging in pre-market trading after the home goods retailer filed for Chapter 11 bankruptcy protection.

Artificial intelligence software provider C3.ai may also come under pressure after Wolfe Research downgraded its rating on the company’s stock to Underperform from Peer Perform.

On the other hand, shares of Medtronic (MDT) may move to the upside after Wells Fargo upgrade its rating on the medical device maker’s stock to Overweight from Equal Weight.