Stock futures saw minimal movement on Sunday night as investors gear up for a significant earnings week and continue to monitor market reactions following last week’s declines.
Futures tied to the Dow Jones Industrial Average fell slightly by 16 points or less than 0.1%. S&P 500 futures increased by 0.1%, while Nasdaq 100 futures posted a modest gain of 0.2%.
Major Indices Struggle to Maintain Momentum
The market’s muted movement follows a challenging week for all three major indices, which have come down from the highs reached after the presidential election. The Dow Jones Industrial Average closed the week at 43,444.99, down from earlier surpassing 44,000 for the first time. Similarly, the S&P 500 ended at 5,870.62, and the Nasdaq Composite slipped to close at 18,680.12.
Investor concerns over the Federal Reserve’s monetary policy continue to weigh heavily. Last week’s sell-off was driven in part by Federal Reserve Chair Jerome Powell’s statement that the central bank is not in a rush to cut interest rates, given the strong growth in the U.S. economy and a resilient labor market. Currently, most investors expect the year-end overnight lending rate to be in the range of 4.25% to 4.50%, according to market analysis tools.
Nvidia Earnings in Focus This Week
A key event for markets this week will be Nvidia’s upcoming earnings report, scheduled for release on Wednesday. Investors are particularly eager to hear guidance on demand for the company’s Blackwell AI chips, which have been a focal point for growth in the tech sector. Nvidia’s performance is often seen as a bellwether for the broader AI industry, making its earnings closely watched by traders and analysts alike.
Earnings reports from other major companies are also on the calendar this week, including Palo Alto Networks and leading retailers such as Walmart, Target, and Ross. According to recent data, 93% of S&P 500 companies have already reported their quarterly results, with approximately 75% exceeding earnings-per-share expectations and 61% surpassing revenue estimates.
Bank of America Updates S&P 500 Target Amid Valuation Concerns
Amid market volatility, Bank of America recently raised its year-end price target for the S&P 500 to 6,000 points. However, analysts remain cautious, noting that the market appears statistically expensive across most valuation metrics. While concerns about overvaluation persist, analysts have pointed out that the current S&P 500 is of higher quality, with less leverage and a more asset-light structure compared to previous decades.
The firm also highlighted the potential for a rotation toward cyclicals and high-dividend-yielding stocks, particularly if economic growth accelerates under favorable fiscal policies. Long-term growth expectations for megacap technology companies remain at record highs, though a shift in market focus could support sectors such as industrials and energy.
Modest Start to the Week
As the new trading week begins, stock futures remain largely flat. Dow Jones Industrial Average futures edged up by 6 points, maintaining a neutral stance. S&P 500 futures showed minimal movement with a gain of less than 0.1%, while Nasdaq 100 futures increased by 0.1%.
With a pivotal earnings season underway and economic uncertainties looming, investors are treading cautiously. This week’s developments, particularly Nvidia’s earnings and any shifts in interest rate expectations, could serve as significant market drivers.
