(Reuters) – U.S. stock index futures were mixed on Monday as investors looked ahead to a week of third-quarter earnings reports and crucial data, seeking insights into the health of the world’s largest economy.
At 5:28 a.m. ET, the Dow E-minis were down 35 points (0.08%), the U.S. S&P 500 E-minis were down 5.75 points (0.10%) and the Nasdaq 100 E-minis were down 30.5 points (0.15%) higher.
Major financial companies started third-quarter corporate earnings season on a generally positive note Friday, with JPMorgan Chase, Wells Fargo and BlackRock recovering after results.
Their gains pushed the Dow Jones Industrial Average and the benchmark S&P 500 to record highs last session.
Still, with stock valuations under pressure – the S&P 500 trades at 21.7 times forward earnings, versus a long-term average of 15.7 – companies will be forced to justify them and satisfy investors.
“While the earnings bar overall is higher than expectations, valuations remain elevated,” said Marc Ostwald, chief economist and global strategist at ADM Investor Services International.
“There will be, among other things, a very strong focus on profit margins, labor costs and on (artificial intelligence) capital investments, and the extent to which companies can postpone their capital investments due to uncertainty about the outcome of the November crisis (US). elections.”
Forty-one S&P 500 companies are expected to report their results this week, including Bank of America, Citigroup, Johnson & Johnson and Netflix.
The S&P 500’s third-quarter earnings growth is estimated at 4.9% on an annual basis, according to LSEG data on Friday.
Investors will also be watching key economic data this week, especially September retail sales expected Thursday, for clues about the financial health of U.S. consumers.
While traders have trimmed expectations for an outsized 50 basis point rate cut from the Federal Reserve in November following a set of strong labor market data, bets on a 25 basis point rate cut have remained largely intact.
Markets see a 90% chance of a rate cut in November and expect around two rate cuts in the rest of the year, LSEG data shows.
Among single movers, aircraft maker Boeing fell 1.9% in premarket trading after the company posted a bigger-than-expected Q3 loss on Friday and said it would cut 17,000 jobs and delay first deliveries of its 777X jet by a year would postpone.
Investment bank B. Riley Financial rose 19% after the company said it will sell its Great American Group unit to asset manager Oaktree Capital for about $400 million.
Federal Reserve officials Christopher Waller and Neel Kashkari will speak that day.
(Reporting by Lisa Mattackal in Bengaluru; Editing by Pooja Desai)
