Stock futures climbed on Monday as Wall Street prepared for a bustling week of tech giant earnings and economic data releases. The recent slowdown in the tech sector has weighed on broader market indexes, but the resurgence in small-cap stocks has provided a positive counterbalance. This week’s earnings reports, particularly from tech giants like Microsoft, Meta Platforms, Apple, and Amazon, will be crucial in determining if tech stocks can rebound. Investors are keenly watching these developments to gauge the market’s direction and overall economic health.

European markets started the week on a positive note, buoyed by investor reactions to recent U.S. inflation data. As market participants digest these figures, they are also gearing up for a busy week filled with earnings reports and crucial central bank meetings. The upcoming policy meetings of the Federal Reserve and the Bank of England are particularly in focus, as investors seek clues on the future direction of interest rates.

The upcoming week is set to be pivotal for major Asian economies, with a series of significant economic data releases on the horizon. Japan, China, and South Korea will be in the spotlight, starting with the Bank of Japan’s anticipated rate hike at its July 30 meeting, as forecasted by a Reuters poll of economists. Additionally, China’s July Purchasing Managers’ Index (PMI) will provide insights into the country’s manufacturing and service sectors. Meanwhile, Australia is poised to release its latest inflation figures, which will be closely scrutinized ahead of the Reserve Bank of Australia’s monetary policy meeting on August 6.

Economic Calendar

Earnings Calendar

Notable reports for Monday before the bell include, AMG, CTRI, CAN, HOPE, IART, MCD, OIS, ON, & RVTY.  After the bell include, AMKR, BYON, CHK, CNO, CDP, CORT, CR, CWK, CVI, PLOW, ESI, EQR, FFIV, FLS, HLIT, HOLX, KFRC, LSCC, LTC, NEO, PCH, SAFE, SANM, SBAC, ST, SFM, TLRY, TRNS, VRNS, WELL, & WWD.

News & Technicals’

President Biden has introduced a series of reform proposals aimed at overhauling the Supreme Court, which include implementing term limits for justices and establishing a more stringent ethics code. In response to the Supreme Court’s recent ruling that granted Donald Trump immunity for “official acts” committed during his presidency, Biden is also advocating for a constitutional amendment to ensure that presidents are not immune from criminal prosecution for any crimes committed while in office. With less than six months remaining in his presidency, Biden emphasized that overhauling the Supreme Court will be a key priority.

Shares of Philips surged in early trading on Monday following the company’s announcement of better-than-expected second-quarter earnings. The Dutch device maker reported a 2% increase in comparable group sales, reaching 4.5 billion euros ($4.88 billion), driven by robust demand in North America. However, sales in China declined, which the company attributed to Beijing’s push for self-sufficiency in critical technologies, including healthcare. Despite the dip in China, the strong performance in other regions helped boost investor confidence.

During his keynote speech at the 2024 Bitcoin Conference, Donald Trump refrained from committing to the establishment of an official U.S. bitcoin strategic reserve currency. Instead, he pledged to maintain the current level of bitcoin holdings that the U.S. has accumulated through the seizure of assets from financial criminals. Trump’s stance was notably more conservative compared to RFK Jr.’s proposal, which advocates creating a 4 million bitcoin strategic reserve to parallel the government’s existing gold reserves.

A range of fast-food chains, including McDonald’s and Taco Bell, have introduced $5 meal deals to lure back customers who have been deterred by rising menu prices. These discounts are aimed at attracting low-income consumers who have been particularly affected by the price hikes. However, investors remain cautious, questioning whether these value meals can significantly boost sales without negatively impacting profit margins. The success of this strategy will depend on balancing customer appeal with financial sustainability.

Traders should plan for a wild week of price action with tech giant earnings reports, central bank decisions around the world including an FOMC decision Wednesday as well as several jobs reports that will culminate with Friday employment situation report.  Emotional price gaps are likely and traders should watch for whipsaws as these highly anticipated report results are revealed. 

Trade Wisely,

Doug