‘US stocks opened higher on Monday, rebounding from their worst week of the year, with the S&P 500 turning upbeat as investors braced for a flood of corporate earnings.
The S&P 500 (^GSPC) rose 0.5% to rise back above 5,000, after closing below the key level on Friday for the first time since February amid six straight days of losses. The Dow Jones Industrial Average (^DJI) also added 0.5%, while the tech-heavy Nasdaq Composite (^IXIC) put on 0.6%.
After its recent battering, the market rally has sunk to its most fragile point in months, and this week will be critical to determining whether the malaise continues.
Tech stocks are looking to recover after lackluster earnings from Netflix (NFLX) dragged on a broader market already grappling with geopolitical tensions. Fading chances of an interest rate cut have fueled skepticism that megacaps can continue to shoulder the task of driving gains.
Hopes are now resting on Big Tech earnings later in the week to reassure and reignite the market. On deck are quarterly reports from Meta (META), Microsoft (MSFT) and Alphabet (GOOG). On Monday, Verizon (VZ) is the highlight as the market gets ready for a deluge of reports, with 178 from S&P 500 companies alone due in coming days.
But the focus Monday is on Tesla (TSLA) on the eve of its results, as the EV maker said it has cut prices in the US, China, and several other countries. The Elon Musk-led company has already unsettled some investors with its robotaxi push and decision to have shareholders vote again on Musk’s rejected pay package. Shares fell roughly 4% in early trading.
Meanwhile, debate over the Federal Reserve’s stance on rate cuts continued to rumble, after chair Jerome Powell and fellow policymakers turned more hawkish last week in the face of persistent inflation. Given that, minds are already turning toward Friday’s release of the PCE index — the Fed’s preferred inflation gauge — as critical to assessing whether rates will stay higher for longer.
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