Futures Slump as Investors Await Start of Earnings Season; COVID Cases Rise Across the Midwest

The S&P futures are on the move this morning as investors start to digest the latest round of earnings reports. This morning, a slew of financial institutions will report earnings and provide a glimpse into the economy’s state during the third quarter. Key reports this morning include JPMorgan Chase (JPM), Citigroup (C), and Delta Air Lines (DAL). 

The Dow Jones today is sliding despite support from Walt Disney Co. (DIS). The global `1` entertainment giant recently announced a major corporate overhaul. The firm plans to make its streaming platform the center of its business. Disney will centralize its entire media arm into a single organization and will focus on ad sales, content distribution, and its Disney+ platform. Let’s take a look at the numbers from Monday before we get into the headlines driving the futures market

IndexPrevious CloseNominal ChangePercent Change
S&P 5003534.22+57.09+1.64%
Dow Jones28837.52+250.62+0.88%

Here are the key headlines that are driving the Dow Futures this morning. Look for additional updates throughout the day.

The Rundown: Today’s Top Market Stories

  • This morning is a big day for earnings season. I know you’re just as excited as I am to listen to CNBC rattle off names for a few hours but give very little insight about anything. Today, I’m very focused on BlackRock (BLK) out of the busy schedule. The reason – given the huge jump in the markets over the third quarter, I want to know exactly how much money has flowed into this private equity giant this year. The ongoing shift toward private equity and alternative investments creates several unique opportunities to develop new research products and give retail investors a viable alternative to Blue Chip stocks.   
  • Markets are still waiting for a new COVID-19 relief package out of Congress. President Trump has signaled his willingness to sign a $1.8 trillion package. However, Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin are still far off on a potential deal. 
  • This morning, Apple will host an event to discuss the state of its iPhone lineup. Wall Street expects that the firm will announce a major overhaul of its iconic devices. Most analysts anticipate that the company will announce a string of new devices equipped for the dynamic rollout of 5G. We might also hear a few details about its booming services businesses, which include Apple Music, Apple Pay, and Apple TV. Today is dubbed “the most important iPhone event” in years.

COVID-19 Updates

This morning, the key COVID story driving the market is the ongoing rise of cases just three weeks before the election. The virus continues to sweep across the Midwest and West and may continue to impact the Red States. Nationally, the seven-day average of new cases surpassed 48,700. That is the highest figure since mid-August.

Meanwhile, the University of Florida announced plans to provide more in-person classes during the next quarter. According to the New York Times, the company has cited economic and educational reasons for its decision to boost in-person classes on January 11. Someone needs to tell the university’s president that COVID-19 has changed the future of education forever.

Today’s Top Stocks to Watch: JPM, JNJ, ETH

JPM: JPMorgan Chase is reporting earnings this morning, and it’s not supposed to be pretty. According to estimates, JPM is set to report a 25% drop in quarterly profits from the same time last year. Thanks a lot, Jerome Powell. Ongoing weakness in the loan markets despite low-interest rates is hitting banks right now.

JNJ: Johnson & Johnson will report earnings today. But the real story will center around the company’s ongoing efforts to deliver a COVID-19 vaccine to the market. Whoever wins this race will win one of the greatest “grift contests” in the history of man. Wall Street expects a bit of a drop in its Q3 earnings report. The ongoing COVID outbreak has affected the company’s medical technology business as more Americans put off elective surgery.  

ETH: Ethan Allen Interiors rallied more than 12.5% in premarket hours after the company reported earnings on Monday. Shares popped above $17.80 after the firm reported preliminary fiscal Q1 earnings between $0.34 and $0.36 per share. That range was two cents above consensus expectations. The firm also beat Wall Street revenue expectations, coming in at $151.1 million.