NEW YORK, July 21 —Nasdaq futures eked out gains today as electric automaker Tesla topped Wall Street’s profit target, while futures tracking the S&P 500 and the Dow struggled for direction ahead of more earnings reports.
Tesla rose 3.4 per cent in premarket trading as its quarterly profit benefited from a string of price increases for its cars. That helped offset production challenges, but Chief Executive Elon Musk said it could hurt demand.
Positive earnings reports from Tesla and streaming giant Netflix Inc have of late boosted megacap growth stocks, which have been under pressure from rising interest rates.
Shares of Apple Inc, Amazon.com Inc and Alphabet Inc also gained between 0.2 per cent and 0.4 per cent.
While market participants cheered the positive results, they continue to await anxiously a Federal Reserve meeting next week where policymakers are expected to raise interest rates by 75 basis points to curb runaway inflation.
The rate decision will be followed by the crucial second-quarter US gross domestic product data, which is likely to be negative again.
By one common rule of thumb, two quarters of negative GDP growth would mean the United States is already in a recession.
“The backdrop for US corporate earnings looks challenging. With slowing economic growth, a strong US dollar and margins looking stretched, we suspect S&P 500 companies will struggle to meet the optimistic expectations embedded in analyst forecasts,” said Thomas Mathews, markets economist at Capital Economics.
Analysts expect aggregate year-on-year S&P 500 profit to grow 5.9 per cent for the second quarter, down from the 6.8 per cent estimate at the start of the three-month period, according to Refinitiv data.
At 6:53 a.m. ET, Dow e-minis were down 96 points, or 0.3 per cent, S&P 500 e-minis were down 7 points, or 0.18 per cent, and Nasdaq 100 e-minis were up 6.25 points, or 0.05 per cent.
Falling oil prices hit Chevron Corp, which fell 2.4 per cent, while other energy companies including Marathon Oil Corp , Occidental Petroleum Corp and Exxon Mobil Corp dropped between 2.3 per cent and 4.2 per cent. — Reuters
