Investors are gearing up to check out Tuesday's corporate reports from well-known brands like Merck, Starbucks, and Caterpillar. Meanwhile, Facebook owner Meta Platforms is said to be preparing to launch a new artificial intelligence chatbot that can take on the personality of different characters. Here are some things market players in the market should know:
1. The stock futures market went wrong
US stock futures were slightly below the zero line on Tuesday as the new trading month began with a stream of corporate earnings to be released.
Dow Jones futures fell 97 points or 0.27%, S&P futures lost 12 points or 0.25%, and Nasdaq 100 futures fell 48 points or 0.30%.
Major indexes closed positive in July, with the S&P 500 index posting a 3.1% gain for the month after the close of trading on Monday. This is the fifth consecutive month of increase. The Dow Jones Industrial Average also rose more than 3% in July, while the tech-heavy Nasdaq Composite index added around 4.1%.
Initial signs of easing inflation, resilient economic activity, and expectations that the Federal Reserve may back off from an aggressive interest rate hike campaign have contributed to supporting a broad rally in stocks. Meanwhile, the second-quarter earnings season has featured stronger-than-expected results from a number of large companies.
2. Income Report Becomes Focus
The corporate earnings stream is expected to be released on Tuesday, which will see more than 160 S&P member companies report their latest quarterly results.
Prominent in Tuesday's release before the start of US trading were pharmaceutical companies Merck and Pfizer, as well as large construction equipment company and economic indicator Caterpillar. Chipmaker AMD and coffee chain Starbucks will also reveal earnings results after the close.
At the end of the week, technology companies Amazon (and Apple) are scheduled to report their latest results.
More than half of the companies in the S&P 500 index have reported. According to FactSet data collected by CNBC, four-fifths of these businesses have reported earnings that exceeded Wall Street's expectations.
3. Meta is ready to launch an AI – FT chatbot
Meta Platforms is set to launch a new artificial intelligence-powered chatbot with a distinct personality, according to a report in the Financial Times, as parent Facebook tries to boost user engagement.
4. Lower Oil Prices
Oil prices fell on Tuesday in a sign of potential profit-taking following gains in July supported by tightening global supplies and hopes of a recovery in demand in the second half of the year.
US crude futures traded 0.37% lower at $81.50 a barrel, while the Brent contract fell 0.29% to $85.18 a barrel.
Analysis cited by Reuters argued that oil prices may be recovering after being too high in the past few months. Meanwhile, sentiment was dented by private surveys that showed further weakness in the economy of China, the world's largest crude oil importer.
However, both US crude and Brent were at their highest levels since April on Monday, supported in part by the prospect of production cuts by Saudi Arabia and Russia this month. Riyadh is also reportedly expected to extend its oil supply cuts until September at a meeting this Friday by the Organization of the Petroleum Exporting Countries and its allies.
