Markets in ‘pivotal’ week with Big Tech earnings, jobs data on tap as U.S. elections loom
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Barclays said this week is one of the most pivotal in the 2024 trading year, with Magnificent 7 tech stocks among those turning in earnings reports, leading into the monthly U.S. jobs report before next week’s U.S. presidential and congressional elections.
Mag 7 member Alphabet (GOOG) (GOOGL) is set to release Q3 earnings late Tuesday, among the ~45% of S&P 500 (SP500) scheduled to post financial updates this week. On Friday, the October payrolls report is due, along with PMI and ISM manufacturing data.
For companies reporting this week, Barclays found an average implied move of 5.5%, “one of the highest in recent history,” by ranking as the fifth largest in 10 years, Stefano Pascale, Barclays equity derivatives strategist, said in a note Tuesday. “Additionally, it appears to be outsized, given its historical relationship with the VIX,” he said, and published these charts:
Meanwhile, the October jobs report is priced in line with history, Pascale said. S&P 500 (SP500) options imply a 0.94% move for that report, in line with last year’s average realized move of 0.89%, and the September jobs report.
Add in the ISM and PMI reports, and Friday is the “most important macro catalyst day before the U.S. elections,” Pascale said. He said Barclays economists expect job gains of 125K in October, slowing from September’s blowout 254K payrolls increase because of hurricanes and labor strikes.
Back on the earnings docket, Mag 7 companies Microsoft (MSFT) and Meta Platforms will report on Wednesday, followed by Apple (AAPL) and Amazon (AMZN) on Thursday.
As of midday Tuesday, the S&P 500 (SP500) was up +22% this year, and the Nasdaq Composite (COMP:IND) was up +24%. The Dow Jones Industrial Average (DJI) had advanced +12%.
Here are some ETFs linked to artificial intelligence and robotics: (AIQ), (BOTZ), (TECB), (XT), and (CHAT).
S&P 500 (SP500) ETFs include (RSP), (SPY), (SDS), (VOO), (IVV), and (UPRO), and here are a few Nasdaq (COMP:IND) ETFs: (QQQ), (SQQQ), and (QLD).