Market Watch:-Dow futures contract increased by 0.1%, S&P 500 futures by 0.8%, and Nasdaq 100 futures by 1.1%.
Stock futures focus on earnings from Alphabet and Microsoft, with investors anticipating a fresh inflation indicator later in the day, potentially impacting Federal Reserve monetary policy decisions.
Alphabet Microsoft rise
Alphabet’s first-quarter revenue surpassed expectations, reaching $80.5 billion, surpassing Wall Street’s $78.7 billion. The surge was largely due to increased demand for AI services on its Azure cloud computing platform. Alphabet’s earnings per share beat consensus estimates, and operating margin improved to 32%. Microsoft’s cloud division also saw significant growth, with the company’s Chief Financial Officer predicting increased capital expenditures to meet demand for its AI offerings.
Snap’s earning
Snap’s earnings exceeded estimates, boosting shares by 21%. The social media giant reported a $1.2 billion revenue for the first three months of 2022, largely due to improved advertising services. Daily active users also increased.
Snap, under scrutiny after Meta’s disappointing results, has announced Q1 revenue guidance between $1.23 billion and $1.26 billion, contrasting analysts’ expectations of $1.22 billion.
PCE Data today
The March personal consumption expenditures (PCE) price index is expected to remain unchanged at 0.3%, with an annualized increase to 2.6%. Core PCE data, which excludes volatile items, is expected to be 2.6% year-on-year, slowing from 2.8%. The Fed’s decision to raise borrowing costs has been influenced by cooling inflation.
Economic Calendar
- 8:30 Personal Income and Outlays
- 10:00 Consumer Sentiment
- 1:00 PM Baker-Hughes Rig Count
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MFitch Ratings has downgraded China’s credit rating outlook to “Negative” from “Stable” due to concerns over growing public debt and slowing growth in the world’s second-largest economy. The agency affirmed China’s rating at A+, citing increasing risks to China’s public finance outlook. Concerns over slowing economic growth have grown in recent months, with Fitch expecting gross domestic product growth to fall to 4.5% in 2024.
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U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.
Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.
U.S. inflation data for February is expected to provide insights into the future direction of Federal Reserve monetary policy. The overall consumer price index (CPI) is expected to match the previous month’s pace of 3.1% annually, with the core CPI expected to slow to 3.7% from 3.9% in January. However, the month-on-month gauge is expected to shed light on price gains momentum.
Fed officials have made cooling inflation the main objective of interest rate hikes, which have brought borrowing costs to over two-decade highs. They suggest cuts may be coming later this year, but need more evidence that price growth is sustainablely easing back down to their 2% annualized target. Analysts at ING believe inflation is likely too hot for comfort.