US earnings

This week sees earnings from more US tech firms, including Alphabet, Amazon, and Disney.

This week, earning season kicks off with US banks

This week, we look at earnings from Netflix, Goldman Sachs, and ASML.

Earnings drove volatility last week and continue to roll in this week. Attention will be on Amazon, Apple and HSBC. Here we look at what to expect.

US indices point to a stronger start as corporate earnings continue to roll in. Earnings are providing a welcomed distraction after worries over the Fed keeping rates high for longer hurt sentiment last week. US PMI data is due shortly and is expected to show business activity grew at a faster pace. Tesla is due to report after the close after the EV maker's deliveries fell in Q1 and as the share price trades down 40% this year.

S&P 500 and the FTSE fell last week after the market pushed back Fed rate cut expectations and as geopolitical tensions hurt risk sentiment. Look ahead; US core PCE will be a key focus next week, as well as earning season with Tesla earnings and UK bank's earnings.

Earnings season starts to ramp up this week with earnings from Netflix, Bank of America, and Procter & Gamble are among those reports that investors will be watching closely.

US banks kick off Q1 earnings season on Friday, with JP Morgan, Wells Fargo, Citigroup and BlackRock reporting. The results come as the US economy continues to show resilience but as sticky inflation could mean that rates stay high for longer. Delta Airline is also releasing Q1 numbers.

Today’s payroll data reiterated the run of strong labor market data with wages growing at 4% a key concern for the Fed. Futures markets reduced the probability of early rate cuts, but traders made few changes to their bullish stance on equities, bonds, gold or the dollar.

The Dow Jones has quickly shaken off yesterday’s late losses is challenging record highs despite the comedown of the Fed minutes yesterday. The market remains optimistic over the state of the US economy, supported by today’s various jobs sector data releases; the flip-side is that too much strength could slow the pace of interest rate cuts with the Fed “likely at or near its peak rates” according to December policy meeting minutes yesterday. The Bitcoin rally will be tested pretty soon, as the SEC is intended to approve (or not) Bitcoin ETFs.

Oil prices appear to have found support at $70 per barrel, with news of US stock building, further OPEC+ production cuts and Middle East tensions spurring buying action. The Fed’s December meeting minutes were cagey on the outlook for interest rates in 2024. JOLTS labor market data pointed to further weakness, good news for inflation.