Stock futures are mixed this morning following stronger-than-expected earnings results from several companies. Shares of automaker Tesla (TSLA), rallied after being under selling pressure in recent weeks, after CEO Elon Musk stated that production of affordable electric vehicles (EV) should occur in “early 2025 if not late this year”. Elsewhere, aircraft manufacturer and Dow-30 component Boeing (BA) reported narrowing losses and less cash burn during the first quarter of 2024, with the stock price rebounding as a result. Several other companies have reported positive March-period results, as well, pushing the broader indices higher, and suggesting a strong start to the trading day.

Equities were resilient yesterday, bouncing back following several days of downward price movement that had occurred in mid-April. Positive earnings results and improved outlooks for the rest of the year have helped to allay worries about future earnings performance. Additionally, the stocks of homebuilders were helped by better-than-expected new home sales figures, which increased 8.8% to 693,000 annually. Overall, the S&P 500 rose 60 points (up 1.20%), the NASDAQ climbed 245 points (up 1.59%), and the Dow Jones Industrial Average increased 264 points (up 0.69%). Market breadth was quite positive, with advancers outpacing decliners by a notable 4.8-to-1.0 ratio. Most of the stock market sectors were in the green yesterday, though communications services were among the best performers. Materials stocks were the only sector in the red yesterday.

In commodity news, oil prices were notably higher yesterday, benefiting from increased sentiment for future demand. The Chicago Board Options Exchange Volatility Index, or VIX, commonly known as the fear index, fell rapidly yesterday as traders priced in the need for reduced options protection. It had previously hit its annual high before falling considerably in recent days as the market recovered.

Looking ahead, several key economic reports and earnings releases will provide valuable insights into the broader economy. On Thursday, we can expect initial jobless claims, U.S. first-quarter GDP, and pending home sales for March. Friday will bring personal income and spending data, as well as the core- and non-core Personal Consumption Expenditures (PCE) indices, offering a glimpse into consumer behavior. Earnings season will also be in full swing, with a multitude of companies reporting each day. Notable names to watch include Dow-30 components IBM (IBM), Caterpillar (CAT), Merck (MRK), Intel (INTC), and Chevron (CVX), as well as Alphabet (GOOG) and Exxon Mobil (XOM). - John E. Seibert III

At the time of this article’s writing, the author held positions in one or more of the companies mentioned.