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Zurich - Futures on the Nasdaq 100 Index climbed, a signal stocks may kick off the earnings season’s busiest reporting day with a rally after US equities slumped yesterday.
Facebook Inc. jumped 12% in early New York trading after posting another record earnings period, with fourth- quarter sales jumping 52%. Technology peers also rallied, with more than 1.9% gains each in Google parent Alphabet, Amazon.com, Apple and Netflix Amazon and Microsoft are due to report results today, along with some 50 other Standard & Poor’s 500 Index members.
Nasdaq 100 futures expiring in March rose 0.8% to 4160.75 at 6:20 a.m. in New York. S&P 500 contracts rose 0.4% to 1 883. Stocks dropped yesterday after the Federal Reserve, while largely maintaining its policy stance, signalled financial-market turmoil may pose risks to its economic outlook. An Apple-led slump in technology shares also weighed on equities.
“Oil is moving higher, it’s doing better today and - combined with solid numbers out of Facebook and a reasonably dovish, data-dependent Fed - has given a firmer backdrop to the market,” said Patrick Spencer, equities vice chairman at Robert W. Baird & Company in London.
“Earnings won’t prove as bad as people discounted, and maybe at the margin they’ll surprise. If Fed was really concerned about the domestic economy, they would have had a more dovish tone.”
Investors are looking to earnings as a possible bright spot in the worst month for stocks in years. Analysts estimate profit at S&P 500 firms fell 6.3% in the fourth quarter, better than predictions a week earlier that called for a 7% slump. Of those that have already posted results, 80 percent beat earnings projections and 52% exceeded sales forecasts.
Fed policy makers left interest rates unchanged yesterday and said they still expect to raise borrowing costs at a “gradual” pace, while watching to see the impact of the global economy and markets. The comments sent the probability of a March hike lower, to 18% from about one-in-four odds before the meeting.
Since the Fed last month raised rates for the first time in almost a decade, turbulence in financial markets and a dimming of the outlook for worldwide growth have spurred investors to expect a slower rise in borrowing costs.
