Nasdaq, S&P 500 Futures Wobble After 3-Day Rally — Fed Meeting Kickstarts, UnitedHealth Earnings In Spotlight

• Fund manager Louis Navellier said there is clearly growing confidence that Trump is working effectively to negotiate agreements that benefit the U.S.
• Five of the Magnificent Seven mega-cap names will release their financial results on Wednesday and Thursday.
• The Fed meeting kicks off on Tuesday, with the rate decision expected on Wednesday afternoon.

There could be a let-up in the scorching pace of gains witnessed in the past three sessions as the major index futures fluctuated around the unchanged line early Tuesday. Earnings could heavily influence the trading direction even as traders stay glued to the Federal Reserve’s interest rate decision due on Wednesday.

Five of the Magnificent Seven mega-cap names will release their financial results on Wednesday and Thursday. Despite fears of margin erosion due to tariffs and higher costs, the net profit of S&P 500 companies stayed above the five-year average for the sixth consecutive quarter, according to FactSet.

How Futures Are Trading

As of 2:15 a.m. ET on Tuesday, the Nasdaq 100, the S&P 500, and Dow futures were little changed, while the Russell 2000 futures fell 0.32%.

On Stocktwits, retail sentiment toward the SPDR S&P 500 ETF (SPY), an exchange-traded fund that tracks the S&P 500 Index, remained ‘bearish’ heading into Tuesday’s session. The Invesco QQQ Trust (QQQ) ETF, which tracks the Nasdaq 100 Index, elicited a ‘bearish’ sentiment among retailers, a deterioration from the ‘neutral’ sentiment seen a day ago. The message volume on the SPY stream remained ‘normal,’ while that on the QQQ stream ticked up to ‘high’ levels.

How Markets Traded Monday

Stocks set fresh highs yet again on Monday, as traders savored the positive outcome of the  U.S.-China trade talks held over the weekend. The SPY, QQQ ETFs and SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 1.18%, 1.78%  and 0.66%, respectively, while the iShares Russell 2000 ETF (IWM), rose a more modest 0.35%.

Fund manager Navellier said the catalyst is the news that negotiations with China over tariffs are expected to go well. “There is clearly a growing confidence that Trump is working effectively in negotiating for agreements that benefit the US,” he said, adding that the lack of tariff-fueled inflation and the massive amount of proposed investment in the US to avoid tariffs are the key here.

Key Catalysts To Watch Out For

The Fed meeting kicks off on Tuesday, with the rate decision expected on Wednesday afternoon. The Conference Board is scheduled to release the results of its October consumer confidence survey at 10 a.m. ET. Economists, on average, expect the index to come in at 94, slightly lower than September’s 94.2.

The S&P Case-Shiller home price index for August is due at 9 a.m. ET. 

Among the key earnings reports for the day are those from D.R. Horton (DHI), JetBlue Airways (JBLU), PayPal (PYPL), Royal Caribbean (RCL), SoFi Technologies (SOFI), UnitedHealth (UNH), UPS (UPS), Caesars Entertainment (CZR), Electronic Arts (EA), Seagate (STX), Teradyne (TER) and Visa (V).

How Other Markets Fared

Crude oil futures continued to slide early Tuesday, gold futures extended their downtrend, dropping below the $4,000 psychological level, and the 10-year U.S. Treasury note yield remained below 4%. The U.S. dollar was weaker against most major currencies amid expectations of a Fed rate cut.

The major Asian markets pulled back amid some profit-taking, as traders moved to the sidelines ahead of key U.S. tech earnings and the Fed rate decision.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: UnitedHealth Stock In Spotlight Ahead Of Earnings: Retail Traders Bet On Recovery After ‘Kitchen-Sink’ Q2

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