Dow Jones futures up 47pts, Facebook and eBay earnings ahead this week

‘Momentum seems to be slowing in equity prices in the short-term, prompting some-level of profit taking from market participants,’ said IG market analyst Kyle Rodda.

Dow Jones futures point to a higher open on Monday

Dow Jones Industrial Average (DJIA) futures were trading 47 points or 0.18% higher at 3:34AM – New York time – suggesting the key US benchmark would open higher on Monday, 27 July. On Friday, the DJIA fell 182 points – to last trade at 26,469.

During the last session, Verizon, Caterpillar, and McDonald's were the best performing Dow constituents; while Pfizer, Cisco and Intel were the worst performing.

Microsoft has also trended lower over the last five sessions, after reporting its Q4 results to the market last week. Here the tech giant reported revenues of US$38 billion, against net income of US$11.2 billion. Impressively, the company’s Intelligent Cloud business segment continues to report robust revenue growth, rising 17%, to hit US$13.4 billion during the quarter.

Mind you, while futures are suggesting the three key US benchmarks – the Dow, the S&P 500 and the Nasdaq Composite – will all open higher on Monday, last week was ultimately a volatile one for equities. Commenting on those market moves, IG market analyst Kyle Rodda today wrote that:

‘Momentum seems to be slowing in equity prices in the short-term, prompting some-level of profit taking from market participants.’

Speaking of the driving force behind the recent fluctuations, Mr Rodda elaborated that:

‘Certain macro-factors are being pointed to as well as being the softness in stocks in recent days. US-China tensions have apparently rattled the nerves of investors, with US President Donald Trump stating the US-China trade deal means “much less” because of the virus. And the impacts of the COVID-19 pandemic on the US economy have returned to the fore, as the crisis continues to escalate in the US.’

At the time of writing there were 4.3 million reported cases of the coronavirus in the United States.

Key earnings loom: the week ahead

Looking forward, it’s set to be a busy week in terms of corporate earnings – with Boeing, Caterpillar Inc (All Sessions), Apple, Facebook and Amazon all reporting over the next five sessions.

Facebook (FB) is set to release its Q2 on Wednesday and though the company remains favoured by analysts – it has recently faced increased pressure from it blue-chip advertisers as well as regulators over antitrust concerns. Despite that, Facebook’s financial position remains enviable, in Q1 reporting a cash position of ~US$60 billion.

To read more about Facebook’s upcoming Q2 earnings, click here now.

Unlike Facebook, eBay (EBAY) – which is set to report its second quarter results on Tuesday – has experienced a revival of sorts in recent months, with its share price more than doubling from its March lows. Maybe more impressively, the company in June upgraded its Q2 revenue and earnings guidance, and recently announced the sale of its Classified Business to Adevinta – in a deal valued at US$9.2 billion.

We provide a preview of eBay’s Q2 here.

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