Yesterday’s big bounce by the tech sector that drove the NASDAQ back up 2.0% appears to be running out of steam for now as investors turn their focus to major earnings releases and central bank decisions.
Overnight, Starbucks ($0.69 vs street $0.67, up 2.5% premarket) beat expectations on earnings. Several big-name technology companies report after the close this afternoon, with Microsoft, Meta, Tesla, IBM, and Lam Research among the headliners.
US index futures are trading flat to up 0.3% with NASDAQ futures leading. European bourses are having a good day with the Dax up 0.8% and the FTSE up 0.3%. Commodities are mixed with Crude Oil down 0.4%, Natural Gas down 1.3% and Copper up 0.2%.
There is a lot of potentially significant central bank news on the way. The Bank of Canada, at 9:45 am EST this morning, and the European Central Bank, at 8:15 am tomorrow morning, are both expected to cut their benchmark interest rates by 0.25%. The Federal Reserve Board is expected to keep the Fed Funds rate steady at today’s 2:00 pm announcement. In all three cases, investors may look to the statements and press conferences for insight into economic conditions and interest rate trends. Any comments from the Bank of Canada about their plans for how to deal with the threat of new US tariffs against Canada would be of particular interest.
Ahead of these decisions the US 10-year treasury note yield is steady near 4.50%, suggesting investors expect no changes and no surprises from the Fed. The US Dollar is climbing ahead of the coming news, gaining 0.3% against both the Euro and the Loonie. Trading in precious metals and cryptocurrencies is quiet today.