Dow, S&P futures rise ahead of earnings; tariffs eyed
As investors prepare for a crucial earnings season, US stock futures rose early Wednesday, with the Dow and S&P 500 indexes both up over 0.35%. The gains come ahead of key earnings reports from McDonald’s and Disney, among others. However, strategists are cautioning that the biggest risk to the market lies in the Trump-era tariffs, which could continue to pose a significant threat to the global economy.
The Dow futures rose 145 points, or 0.43%, to 27,843, while the S&P 500 futures gained 14.25 points, or 0.43%, to 3,110. The Nasdaq futures, on the other hand, lagged, rising just 0.2% amid a pullback in AI stocks.
Growth, large caps, and financials are preferred sectors ahead of the earnings season, according to strategists. The Federal Reserve’s dovish stance on interest rates has helped boost the markets, and investors are hoping that the central bank will continue to support the economy.
However, the tariffs imposed by the Trump administration remain a major concern. The trade tensions between the US and China have been a major drag on the global economy, and any escalation could lead to a significant downturn in the market.
“We’re entering a seasonally weak period, and the biggest risk is the tariffs,” said Peter Cardillo, chief market economist at Spartan Capital Securities. “If the tariffs continue to escalate, it could lead to a decline in global trade and a hit to corporate profits.”
The earnings season is expected to be a crucial test for the market, with many major companies set to report their quarterly results. McDonald’s and Disney are among the most highly anticipated reports, with investors looking for signs of strength in the consumer and entertainment sectors.
McDonald’s is expected to report earnings of $1.91 per share, according to estimates from FactSet, while Disney is expected to report earnings of $1.54 per share. Both companies have been struggling with declining sales and profitability in recent quarters, and investors will be looking for signs of improvement.
The financial sector is also expected to be a key focus, with many banks and financial institutions set to report their quarterly results. JPMorgan Chase, Bank of America, and Citigroup are among the major financials that will be reporting their earnings in the coming days.
The tech sector, which has been a major driver of the market’s gains in recent years, is also expected to be a key focus. Apple, Amazon, and Alphabet are among the major tech names that will be reporting their earnings in the coming days.
Overall, the market is expected to be volatile in the coming days, with investors looking for signs of strength in the earnings reports. The tariffs remain a major concern, and any escalation could lead to a significant downturn in the market.
