Early on Tuesday, Dow Jones futures surged, accompanied by gains in S&P 500 futures and Nasdaq futures, fueled by a notable upturn in UnitedHealth Group (UNH) following robust earnings. Concurrently, fellow Dow heavyweight Johnson & Johnson (JNJ) released its earnings report.
Despite an initial attempt to rebound on Monday morning, the stock market experienced a sharp downturn, marking another turbulent reversal. Both the S&P 500 and Nasdaq indices breached significant thresholds. Amid uncertainties surrounding Israel’s response to Iran’s drone and missile strike on Saturday, Treasury yields soared to fresh highs for the year 2024.
In contrast, Tesla (TSLA) witnessed a steep decline attributed to significant layoffs and a flurry of adverse headlines. Similarly, Salesforce.com (CRM) registered a notable drop on reports suggesting advanced negotiations for the acquisition of data-management software maker Informatica (INFA).
Meanwhile, despite slipping below crucial thresholds on Monday, AI juggernauts Nvidia (NVDA) and Microsoft (MSFT) managed to maintain their stability without any imminent breakdowns.
On Tuesday, Microsoft revealed a substantial investment in G42, an AI firm based in the United Arab Emirates.
Both Nvidia and Microsoft are prominently featured on the IBD Leaderboard and the IBD 50, while Microsoft also holds a spot on the IBD Long-Term Leaders list.
Current Dow Jones Futures Status
Dow Jones futures surged by 0.6% compared to fair value, buoyed by the strong performance of UNH stock post-earnings, while J&J experienced a slight downturn. S&P 500 futures and Nasdaq 100 futures exhibited modest gains of 0.1% each.
Meanwhile, the 10-year Treasury yield edged up to 4.64%, while crude oil futures witnessed a marginal decline.
In China, the economy displayed resilience, with a first-quarter growth of 5.3% compared to the previous year, surpassing estimates of 4.6% and marginally improving from the 5.2% recorded in the fourth quarter. However, March retail sales and industrial production figures fell short of forecasts, with a 3.1% and 4.5% increase, respectively, compared to the previous year.
In the United States, investors eagerly await March’s housing starts and industrial production data ahead of the market open.
It’s important to note that overnight movements in Dow futures and other indices may not necessarily reflect actual trading activities in the subsequent regular stock market session.
UnitedHealth’s Strong Earnings Lead the Way
UnitedHealth unveiled better-than-anticipated earnings and revenue figures early on Tuesday, propelling its stock price upwards. This surge comes after a period of decline, driven by the fallout from a significant cyberattack and lower-than-expected Medicare Advantage rates.
Meanwhile, Johnson & Johnson exceeded profit projections while meeting sales expectations. Despite issuing guidance in line with earnings per share forecasts, revenue expectations were slightly revised downwards, leading to a minor dip in share value, which remained close to 2024 lows.
Bank of America (BAC) marginally surpassed expectations, with its stock holding steady in premarket trading following recent support found at the 10-week line.
Morgan Stanley (MS) outperformed consensus estimates, resulting in a modest uptick in its stock price before the market opened. Shares of Morgan Stanley had closed the previous day positioned between their 50-day and 200-day moving averages, following a decline triggered by reports of regulatory scrutiny into the company’s wealth-management division.
