Stock futures fell Tuesday as investors looked ahead to big technology earnings for further clues into the health of the U.S. economy.
Futures tied to the Dow Jones Industrial Average slid 130 points, or 0.4%. S&P 500 and Nasdaq 100 futures dipped 0.4% and 0.2%, respectively.
Shares of Amazon slipped slightly in premarket trading on reports of a hiring freeze, while Discover Financial shed more than 1% on disappointing earnings results.
Tuesday’s moves came after another strong day for stocks.
The Dow rose 417.06 points, or 1.3%, on Monday. The Nasdaq Composite finished 0.9% higher and the S&P 500 added roughly 1.2%, with nine of 11 sectors finishing higher, led by health care.
Investors this week remain laser-focused on earnings from the biggest technology companies, with reports from Alphabet and Microsoft due Tuesday. Meta Platforms reports Wednesday, followed by Amazon and Apple on Thursday. Given their sheer size and market capitalization, any moves are likely to drive the market going forward.
So far this season, companies have proven they may be faring better than anticipated. That’s due in part to the fact that analysts’ earnings estimates have come down in recent months as companies faced foreign exchange headwinds and other growth concerns. This could set up stocks for rallies on potentially better-than-feared outcomes.
“‘Earnings really have come down quite a bit,” said Sam Stovall, chief investment strategist at CFRA. “Maybe investors are happy because it’s up 2% and not down 2% but we’ve also been seeing reductions in 2023 forecasts. This bear market probably has to play itself out even if we do get a near-term bear market rally.”
Reports from UPS, General Electric, Coca-Cola and General Motors are due out before the bell on Tuesday. Chipotle Mexican Grill and Texas Instruments will report after the Tuesday close.
On the economic data front, S&P/Case-Shiller August home prices, FHFA August home prices and October consumer confidence are slated for release Tuesday.