US stock market futures are pointing lower at the opening after trading in Asia and Europe ended mixed. Traders had hoped for a much stronger opening call after speculation that the Federal Reserve could slow its rate hikes, but that outlook was tempered by a more cautious tone ahead of key earnings reports this week.
The most important pre-market movers
Despite weaker demand for the broad averages, several large companies are expected to open higher on strong gains. These include Coca-Cola, General Motors, General Electric and UPS.
Coca-Cola shares are expected to open about 2.9% higher based on pre-market trading, after the beverage giant’s third-quarter earnings and sales beat Street’s forecasts. The company also raised its full-year outlook as demand remains stable, even as it has raised prices to offset higher costs.
Shares of General Motors are quoted about 4.4% higher after the automaker reported better-than-expected third-quarter earnings, helped by improving sales. GM also said that supply chain restrictions are easing, allowing it to increase inventory on dealer lots.
General Electric is expected to rise about 4.2% at its opening based on early trading, although earnings are lagging behind forecasts. The company lowered its full-year outlook as it battled supply chain issues and increased costs. GE’s sales were stronger than expected, as was free cash flow.
UPS shares of the delivery service were up about 4.4% before the money market opened, following a mixed quarterly report in which earnings beat consensus and sales lagged. UPS was helped by increased profit margins as it increased prices.
On the other hand, JetBlue and Xerox were the biggest losers for the opening.
House prices fell at a record pace in August
House prices fell in August at the fastest rate on record as the housing market struggles with sharply higher interest rates.
“The strong US home price slowdown that we noted a month ago continued in our August 2022 reports,” Craig Lazzara, Managing Director at S&P DJI, wrote in a press release.
“The price increase slowed in each of our 20 cities. These data clearly show that the growth rate of house prices peaked in the spring of 2022 and has been declining since then.
The NASDAQ is trading higher, so that probably means investors are already betting on favorable earnings reports from major technology after the bell. These reports are expected to provide further clues to the health of the US economy.
Alphabet and Microsoft are among the companies that will report profits after the bell. Chipotle Mexican Grill is also on tap.
Not only are earnings reports a big deal, but whether the Fed will continue its rapid rate hikes or announce a plan to slow its aggressive rate hikes.
The decline in government bond yields could tell us that the Fed may be willing to pause after next week’s meeting. This helps to boost the market.