Stock Market Today: Dow Rises as Apple, Amazon Earnings Approach

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Stocks were gaining Thursday, with the Nasdaq Composite set to open at a record high, as economic uncertainty sent investors to the relative safety of tech shares.

 

Dow Jones Industrial Average
futures have risen 61 points, or 0.2%, after the index fell 266 points Wednesday.

S&P 500
futures have gained 0.3%, while the tech heavy Nasdaq had advanced 0.6%.

Technology stocks are perceived to be able to grow even when economic growth is uncertain. And right now, economic growth is uncertain. U.S. third-quarter GDP is expected to fall to 2.8%, and the Atlanta Fed’s GDPNow forecasting tool puts the number closer to 0.2%.

That economic uncertainty is seen in the bond market. The 10-year Treasury yield has sunk to 1.54% from 1.7% hit a week ago, reflecting lowered expectations for inflation and economic demand for the long-term as the Federal Reserve may begin hiking interest rates in 2022. That’s also evident in the two-year Treasury yield, which had risen to 0.56% from 0.46% a week ago. 

The “flattening” of the yield curve “elicited concerns that the market was pricing in a Fed policy mistake, whereby the Fed tightens conditions too quickly and kills the economic expansion,” wrote Tom Essaye, founder of Sevens Report Research. 

Strong earnings reports were providing a small boost for the stock market. The aggregate S&P 500 earnings per share result has beaten analyst estimates by about 12%, according to Credit Suisse. Companies beating expectations are seeing their stocks outperform the S&P 500 by 0.8 percentage points, but those missing are underperforming by 3.7 percentage points. 

But earnings will continue to be in the spotlight Thursday, with Big Tech heavyweights

Apple

(ticker: AAPL) and

Amazon

(AMZN) reporting results alongside

Royal Dutch Shell

(RDS.A),

U.S. Steel

(X),

Comcast

(CMCSA),

Caterpillar

(CAT),

Mastercard

(MA),

Merck

(MRK), and others.

Overseas, Hong Kong’s

…