After the Dow reversals course, stock futures rise to begin a busy results week.

TradeGM Analysis date_range July 19th, 2022

After the Dow Jones Industrial Average plunged more than 200 points during Monday’s session, reversing an earlier rise as earnings season opened in earnest, stock futures were marginally higher on Tuesday morning.

Futures for the Dow Jones Industrial Average went up 39 points, or 0.13 percent. Nasdaq 100 futures increased by 0.12 percent, while S&P 500 futures increased by 0.21 percent.

Even though the original IT giant reported earnings that topped Wall Street’s earnings and revenue projections, shares of IBM dropped more than 4% after-hours.

A morning rise fuelled by strong earnings announcements from Goldman Sachs and Bank of America was reversed when the Dow dropped more than 200 points to conclude the day in the red. Bitcoin soared to its highest levels since mid-June, and oil surpassed $100 a barrel.

Stocks were driven down late in the trading day by a Bloomberg story that Apple would cut back on hiring and growth spending in order to brace for a future economic slump. Shares of the iPhone manufacturer closed the day down approximately 2.1%.

The National Association of Home Builders released a study on Monday showing that monthly homebuilder sentiment dropped 12 points to 55, the lowest level since the pandemic began. The Federal Reserve is continuing its campaign to raise interest rates in an effort to control excessive inflation, which is putting pressure on confidence across a variety of economic sectors. On Wednesday, July 27, the Fed’s subsequent policy meeting comes to an end.

It is yet unclear if the United States will go through a recession, as well as how long it would last and how deep it might be.

According to Julian Emanuel, senior managing director at Evercore ISI, during Monday’s Fast Money on CNBC, “when we think about earnings and we think about where stocks are now, we think there’s upside simply because there may be overpricing of this recession that some people think is imminent or already upon us.”

This week, more second quarter earnings reports will be released. Tuesday’s quarterly results from Johnson & Johnson, Hasbro, and Netflix will be released after the market close. Tesla, United, American, Snap, Twitter, and Verizon are among the companies slated to report later this week.

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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75.42% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. X