New York Stock Market Rises Ahead of Big Tech Earnings Reports... International Oil Prices Plunge Over 6%

This Week's Earnings Reports from 5 of the 'Magnificent 7' Companies
Employment, Inflation, and Growth Rate Indicators Also Scheduled for Release
International Oil Prices Plunge Amid Middle East Tensions Easing

The three major indices of the U.S. New York Stock Exchange all rose in early trading on the 28th (local time). Investor sentiment is reviving ahead of this week's series of earnings reports from big tech companies. International oil prices are plunging more than 6% as Israel's weekend attacks against Iran remained limited in scope.

As of 10:16 a.m. in the New York stock market, the Dow Jones Industrial Average, centered on blue-chip stocks, was up 0.63% from the previous trading day at 42,378.1. The S&P 500, focused on large-cap stocks, rose 0.49% to 5,836.3, and the Nasdaq, centered on tech stocks, was trading 0.67% higher at 18,642.15.

Israel launched airstrikes against Iran over the weekend but, contrary to concerns, did not target oil or nuclear facilities and ended the attacks within a few hours. Iran emphasized its right to self-defense but did not immediately retaliate, easing fears of a full-scale war and reassuring the market.

Investors are focusing on major corporate earnings reports this week. Five of the "Magnificent 7" companies are scheduled to release their results: Alphabet, Google's parent company; Microsoft (MS); Meta, Facebook's parent company; Amazon; and Apple. Wall Street expects mentions of artificial intelligence (AI) investments by these companies to be a key point of interest for investors.

Young-Yu Ma, Chief Investment Officer (CIO) at BMO Wealth Management, said, "What we are looking for is whether these giant tech companies continue to ramp up spending in the AI sector," adding, "If some tech companies report earnings and indicate they will slightly ease off on some of these investments, the market may not accept that."

Key economic indicators will also be released consecutively this week. On the 29th, the Labor Department's September Job Openings and Labor Turnover Survey (JOLTs) will be published; on the 30th, the October ADP private employment report; and on the 31st, weekly initial jobless claims data. The U.S. third-quarter gross domestic product (GDP) advance estimate will be released on the 30th, and the Federal Reserve's most closely watched inflation gauge, the September Personal Consumption Expenditures (PCE) price index, will be announced on the 31st.

With the U.S. presidential election just eight days away on the 5th of next month, there are also expectations that market volatility could increase.

Chris Larkin, Investment Managing Director at Morgan Stanley's eTrade, said, "This week's big tech earnings and employment data will likely provide enough potential fuel for short-term market momentum," but added, "We need to see whether investors will sit tight and wait until after next week's election." He explained, "Especially considering the volatility in the last two elections, the S&P 500 experienced sell-offs before the 2016 and 2020 elections, followed by sharp rallies."

By individual stocks, tech shares are rising. Alphabet is up 1.08%. Microsoft (MS) is up 0.31%, Meta, Facebook's parent company, is up 0.65%. Amazon and Apple shares are rising 0.91% and 0.83%, respectively.

Government bond yields are rising slightly. The U.S. 10-year Treasury yield, a global bond yield benchmark, rose 2 basis points (1bp = 0.01 percentage points) from the previous trading day to 4.25%, while the 2-year Treasury yield increased 1bp to 4.11%.

International oil prices are plunging as Middle East tensions ease following Israel's limited attacks. West Texas Intermediate (WTI) crude oil fell $4.78 (6.7%) to $67 per barrel, and Brent crude, the global oil price benchmark, dropped $4.80 (6.31%) to $71.25 per barrel.