New York Stock Market Mixed Amid Corporate Earnings Watch... Nasdaq Rises on Tesla Surge

Tesla Soars 10% on News of Low-Cost EV Expansion
Entering Earnings Season... Meta Earnings Released Today

The three major indices of the U.S. New York stock market showed mixed movements around the flat line in early trading on the 24th (local time). Following Tesla's earnings announcement the previous day, a rally in tech stocks continued ahead of the earnings release of Meta, Facebook's parent company, leading to a strong performance in the Nasdaq index.

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As of 9:33 a.m. at the New York Stock Exchange (NYSE) on the day, the Dow Jones Industrial Average was down 0.13% from the previous close, standing at 38,452.67. The S&P 500, which is centered on large-cap stocks, rose 0.13% to 5,077.28, while the tech-heavy Nasdaq index traded up 0.55% at 15,783.02.

By stock, Tesla, which announced plans to expand the release of low-priced electric vehicles, surged 10.6%. The previous day, Tesla reported first-quarter revenue of $21.3 billion and adjusted earnings per share (EPS) of $0.45. Although these figures fell short of LSEG's forecast of $22.15 billion and $0.51, the market reacted positively to the news of new car launches. Bank of America (BofA) upgraded Tesla's investment rating from 'neutral' to 'buy' following the first-quarter earnings announcement.

Visa and U.S. semiconductor company Texas Instruments (TI) rose more than 2.6% and 7%, respectively, after reporting quarterly earnings that exceeded expectations. Boeing also jumped more than 4.8% following better-than-expected earnings disclosure.

Last week, the market struggled due to concerns over delayed interest rate cuts amid high inflation, but this week has entered an earnings season. Optimism about corporate earnings is offsetting worries about prolonged high interest rates. According to market research firm FactSet, more than one-fifth of S&P 500 companies have reported earnings so far, and over three-quarters of them have exceeded analyst expectations.

Solita Marcelli, Chief Investment Officer (CIO) at UBS Global Asset Management, said, "A strong earnings season is likely to help restore market confidence," adding, "We expect S&P 500 earnings per share (EPS) to increase by 7-9% this quarter and overall earnings to grow by 9% in 2024."

Jay Hatfield, Chief Executive Officer (CEO) of Infrastructure Capital Advisors, analyzed, "It is common for the market to become vulnerable before earnings season due to negative economic and political news," describing the current trend as "a typical earnings rally following a decline amid an information vacuum."

The market is closely watching Meta's earnings released on this day. The following day, Microsoft (MS) and Alphabet will announce their earnings. Apple and Amazon are scheduled to report earnings next week. Nvidia will release its earnings on the 22nd of next month.

On the 25th, the preliminary GDP growth rate for the first quarter of this year will be announced, and on the 26th, the March Personal Consumption Expenditures (PCE) price index will be released. In particular, the core PCE price index is expected to rise 2.6% year-over-year, a smaller increase compared to 2.8% in February. With the Consumer Price Index (CPI) exceeding market expectations for three consecutive months this year, the PCE price index, which the Federal Reserve (Fed) closely monitors, is expected to provide hints about the future path of interest rates.

Government bond yields are rising. The U.S. 10-year Treasury yield, a global benchmark for bond yields, rose 3 basis points (bp) from the previous trading day to 4.63%, while the 2-year Treasury yield, sensitive to monetary policy, moved up 3 bp to 4.94%.

International oil prices are steady. West Texas Intermediate (WTI) crude oil fell $0.47 (0.6%) from the previous trading day to $82.89 per barrel, while Brent crude, the global oil price benchmark, dropped $0.35 (0.4%) to $88.07 per barrel.