U.S. stock futures edge higher ahead of tech earnings flood

What’s driving the market?

Corporate results for the first quarter were in the spotlight as one of the busiest weeks of the earnings reporting season got under way, with electric car maker Tesla Inc.
TSLA,
+1.21%
delivering its report late Monday afternoon. Tech results will be in the spotlight, with earnings for Microsoft Corp.
MSFT,
+0.15%
and Google parent Alphabet Inc.
GOOG,
+0.49%

GOOGL,
+0.43%
due after the closing bell Tuesday.

With about a third of S&P 500 index companies reporting so far, about 80% have beaten forecasts, according to FactSet.

“The biggest threat to the positive trend in technology stocks is the reflation trade, which would boost demand for cyclical stocks and move capital from the tech stocks towards the value names,” said Ipek Ozkardeskaya, senior analyst at Swissquote.

“But it looks like that migration from growth to value is happening without too much harm for the tech stocks for now, and some digital services, including the cloud business will unlikely be affected by the reflation theme as the end of the pandemic won’t reverse the migration of our data storage to the clouds,” she said, in a note.

Need to Know: Don’t bail on stocks now, says world’s top fund manager

The Federal Reserve on Tuesday will kick off a two-day policy meeting at which Fed Chairman Jerome Powell is expected to maintain his stance that interest rates won’t begin to rise until inflation exceeds the Fed’s 2% target.

Read: Why the Fed’s focus on those hardest-hit by the pandemic matters for markets

The U.S. economic calendar features the Case-Shiller home price index for February at 9 a.m. Eastern.

A consumer-confidence index reading from the Conference Board for April is due at 10 a.m.

Which companies are in focus?

• Tesla shares were down more than 2% in premarket action after the Silicon Valley electric-car maker reported first-quarter profit above expectations, but saw sales miss the mark slightly.
• Shares of Lyft Inc.
  LYFT,
  -1.00%
  were up 3.2% after the ride-hailing company late Monday said it would sell its autonomous-vehicle division to a Toyota 
  TM,
  -0.94%
  subsidiary for $550 million in cash, calling the move a way to speed up the development of self-driving technology.
• Shares of meme favorite GameStop Corp.
  GME,
  +11.74%
  rose more than 9% in premarket action after the videogame retailer announced after the closing bell that it had completed its “at-the-market” stock offering by selling 3.5 million additional shares for approximately $551 million.
• Shares of drugmaker Eli Lilly & Co.
  LLY,
  -0.79%
  were down more than 3% after it posted weaker-than-expected first-quarter earnings and provided guidance that was below consensus.
• United Parcel Service Inc.
  UPS,
  -1.76%
  shares rose 7.6% after the package delivery giant reported first-quarter profit and revenue that were well above expectations.
• Shares of Dow component 3M Co.
  MMM,
  -1.27%
  fell 1.5% after the conglomerate reported first-quarter earnings and revenue that beat forecasts and affirmed its full-year outlook.
• General Electric Co.
  GE,
  +0.15%
  shares declined more than 2% after the industrial conglomerate swung to a first-quarter loss, but reported adjusted profit that topped expectations while revenue fell short of expectations.
• Hasbro Inc.
  HAS,
  -0.13%
  shares were off 0.9% after the toy maker reported earnings that topped forecasts, while revenues fell short.
• Shares of Archer Daniels Midland Co.
  ADM,
  +0.96%
  shares were higher after the food-processing company topped earnings and revenue expectations for its first quarter. 

What are other markets doing?

• The yield on the 10-year Treasury note
  BX:TMUBMUSD10Y
  rose 1.3 basis points to 1.582%. Yields and bond prices move in opposite directions.
• The ICE U.S. Dollar Index
  DXY,
  +0.09%,
  a measure of the currency against a basket of six major rivals, was flat.
• Oil futures gained ground ahead of this week’s OPEC+ meeting, with the U.S. benchmark
  CL00,
  +0.81%
  up 0.8% at $62.39 a barrel. Gold futures
  GC00,
  +0.18%
  edged higher, rising 0.1% to $1,782.60 an ounce.
• In global equity trading, the Stoxx 600 Europe index
  SXXP,
  -0.24%
  and London’s FTSE 100 index
  UKX,
  -0.21%
  were both down 0.2%. The Shanghai Composite
  SHCOMP,
  +0.04%
  end ed fractionally higher, while Hong Kong’s Hang Seng Index
  HSI,
  -0.04%
  fell slightly and Japan’s Nikkei 225
  NIK,
  -0.46%
  fell 0.5%.