U.S. stocks opened higher on Monday as investors braced for a flood of corporate earnings, attempting to recover from their worst week of the year.
The S&P 500 (^GSPC) rose 0.5% on Friday after closing below the 5,000 level for the first time since February amid six straight days of declines. The Dow Jones Industrial Average (^DJI) rose 0.3%, and the tech-heavy Nasdaq Composite Index (^IXIC) rose 0.7%.
After the recent selloff, the market’s bull run has sunk to its weakest point in months, and this week will be crucial in determining whether that slump continues.
Tech stocks are looking to recover after Netflix’s (NFLX) lackluster earnings dragged down a broader market already facing geopolitical tensions. As the chances of a rate cut fade, there is growing skepticism that megacaps can continue to play a role in driving profits.
Expectations are now resting on the big tech companies’ earnings reports later this week, reassuring and reinvigorating the market. The deck features quarterly reports from Meta (META), Microsoft (MSFT), and Alphabet (GOOG).
The focus on Monday was Tesla (TSLA), with the EV maker cutting prices in the U.S., China and several other countries. Tesla will report its quarterly results after the market closes on Tuesday. Elon Musk’s company has already spooked some investors with its push for robot taxis and its decision to force shareholders to vote again on a pay package that Musk rejected. Shares were down about 2% on Monday morning.
Meanwhile, debate over the Fed’s stance on rate cuts continued to rage after Chairman Jerome Powell and other policymakers became more hawkish in the face of persistent inflation last week. Given this situation, people are already turning their attention to Friday’s release of the PCE index, the Fed’s preferred inflation measure, as important in assessing whether interest rates will remain high for a longer period of time. .
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