Dow, S&P 500, Nasdaq Futures Edge Higher As Investors Brace For Mag 7 Earnings Kickoff: Why HOOD, ENPH, STX, NOK Are In Focus

• The United Arab Emirates announced that it will exit OPEC next month. 
• The Federal Reserve’s key interest rate decision from the latest policy meeting is also expected on Wednesday. 
• The top three U.S. indexes closed lower on Tuesday as reports of missed revenue and new-user targets at OpenAI sent tremors through the market.

U.S. stock futures edged higher in Tuesday’s overnight trading session as markets anticipate strong quarterly results from four “Magnificent Seven” stocks expected to report earnings on Wednesday.

Dow Jones futures were 0.23% higher, the S&P 500 futures climbed up 0.20%, and Nasdaq 100 futures were 0.39% higher as of 8.45 p.m ET.  

Among the ETFs tracking the benchmark indexes, the SPDR S&P 500 ETF (SPY), Invesco QQQ Trust (QQQ), and SPDR Dow Jones Industrial Average ETF Trust (DIA), were all gaining overnight. Meanwhile, retail sentiment on Stocktwits for SPY was in the ‘bullish’ territory, while that of QQQ and DIA was in the ‘neutral’ territory at the time of writing.

How Did US Markets Fare On Tuesday?

All three indexes closed lower on Tuesday as reports of missed revenue and new-user targets at OpenAI sent tremors through the market. The Dow Jones Industrial Average closed down 0.05%, the S&P 500 closed down 0.49%, and the Nasdaq Composite lost more than 223 points, ending the session 0.90% lower.

US Market Drivers

Stock markets are looking to the Mag 7 stocks for cues on artificial intelligence demand and the impact of massive AI capital expenditures announced for the year.

Four of the seven tech mega companies, Alphabet Inc. (GOOG, GOOGL), Amazon.com Inc. (AMZN), Meta Platforms Inc. (META), and Microsoft Corp. (MSFT), will report their quarterly earnings on Wednesday, with Apple Inc. (AAPL) slated to release its results the following day.

Meanwhile, the impact of the U.S.-Israel's war with Iran is rippling through global oil markets. The United Arab Emirates has announced that it will exit the Organization of the Petroleum Exporting Countries (OPEC) next month, dealing a significant blow to the bloc at a critical time for the energy industry.

Markets will also be looking out for the Federal Reserve’s key interest rate decision in the latest policy meeting, which is likely to be Fed Chair Jerome Powell’s last before the end of his term in May. Investors and analysts are expecting the Fed to hold the current federal funds rate, but will be on the lookout for comments about inflation and other economic indicators.

Trending Stocks To Watch

Robinhood Markets Inc. (HOOD): The trading firm reported quarterly earnings on Tuesday, with revenue and earnings missing Wall Street expectations amid weakness in its cryptocurrency business. HOOD stock declined nearly 9% in the overnight session.

Enphase Energy Inc. (ENPH): The Fremont, California-based company’s shares slipped more than 10% after it reported mixed results. The weakness in U.S. residential solar demand overshadowed stronger performance in Europe and the announcement of new data center plans.

Seagate Technology (STX): The data storage company rallied more than 17% after it issued a strong forecast for its memory products, even as revenue and profit for the latest quarter surged.

Nokia Corp. (NOK): The Finnish telecom company garnered attention amid a series of Wall Street price target updates after it reported strong earnings due to growing AI demand last week.

Broader Market Trends

Meanwhile, oil futures slipped lower in Tuesday’s overnight trading. Brent crude futures expiring in June were 0.42% lower but remained above $110 a barrel, while WTI crude futures expiring in May declined 0.78% to $99.15 a barrel at the time of writing.

Treasury yields on the benchmark 10-year were at 4.348%, while gold traded around $4,598.15 an ounce.

Asian markets opened mixed on Wednesday, with the KOSPI climbing higher at the open, while the Nikkei 225 and SSE Composite indices were trading lower. Australian stocks also dipped lower at the open.

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