U.S. stocks are rising as investors await a week that includes the Federal Reserve’s latest decision on interest rates, the jobs report for October, and earnings from Apple.
At 11:07 ET (15:07 GMT), the Dow Jones Industrial Average rose 324 points or 1%, while the S&P 500 was up 0.7% and the NASDAQ Composite rose 0.9%.
The broad-based S&P slumped 2.5% last week, over 10% below its 2023 high and thus falling into correction territory, putting it on course for its third-straight negative month. This would be its first such streak since 2020, in the pandemic era.
Fed meeting to drive sentiment
Weighing on Wall Street last week was a sharp jump in Treasury yields, as traders fretted that a resilient economy would mean that the Federal Reserve kept interest rates at elevated levels for longer than previously expected,
The benchmark 10-year Treasury yield jumped above 5% for the first time since 2007, but has since retraced to 4.87%.
This brings Wednesday’s Federal Reserve policy meeting firmly into the spotlight, with investors eager to hear policymakers’ views on the state of the economy and the outlook for interest rates.
Most investors are betting that the Fed is done tightening after Chair Jerome Powell said that rising long-term yields reduce the need for further rate increases, though some believe another hike could come when the central bank meets again in December.
Payrolls report due Friday
The economic data slate is largely empty Monday, and the week’s key release will be Friday’s nonfarm payrolls report for October. After a blockbuster 336,000 jobs were added in September, economists are expecting more moderate jobs growth of 182,000, which is still consistent with a robust labor market.
The unemployment rate is expected to remain at 3.8%, while wage growth is expected to ease to 4% year-on-year, which would mark a post-pandemic period low.
Apple the highlight of week’s results
Markets will also be keeping an eye on quarterly results from several large U.S. companies this week. Fast food giant McDonald’s (NYSE:MCD) beat expectations as revenue rose 14% and same store sales rose 8.8% on price increases. Shares rose 1.5%.
Investors will also be watching the auto makers after reports early Monday that General Motors Company (NYSE:GM) had reached a tentative agreement with United Auto Workers, potentially setting the stage for an end to a strike, and after Ford Motor (NYSE:F) and Stellantis (NYSE:STLA) have also reached agreements with the union. GM shares rose 0.5%.
However, the main earnings report will come from tech giant Apple (NASDAQ:AAPL), the world’s largest company by market value, which is due to release its fourth-quarter earnings after the bell on Thursday.
Third quarter earnings season has seen disappointments from some Big Tech names, with shares of Alphabet (NASDAQ:GOOGL) and Tesla (NASDAQ:TSLA) slumping after their respective reports.
Crude slips at start of busy week
Oil prices fell Monday as traders adopted a cautious stance at the start of a week that includes a Federal Reserve policy meeting as well as key Chinese economic activity data.
Prices registered hefty losses over the course of the week as there were few signs that the conflict in the Middle East would expand into a wider regional war.
(Oliver Gray contributed to this item.)
https://www.investing.com/news/stock-market-news/dow-futures-lift-earnings-fed-decision-in-focus-3212821
