Stock futures pointed to a slightly lower open Monday morning, with traders bracing for a busy week of corporate earnings results, a Federal Reserve monetary policy decision and deluge of economic data.
Contracts on the S&P 500 ticked down, after the blue-chip index hit a record high late last week. Contracts on the Dow were little changed, while those on the Nasdaq fell about 0.3% ahead of a bevy of Big Tech earnings.
Expectations are high heading into one of the busiest weeks of corporate earnings reports this earnings season. The vast majority of companies that have reported first-quarter results so far have handily exceeded estimates, with the vaccine-enabled recovery helping stoke demand across a wide variety of industries. Tesla (TSLA) is poised to post its quarterly earnings after market close on Monday.
Eighty-four percent of the S&P 500 companies that have reported first-quarter results to date posted a positive earnings per share surprise, according to data from FactSet. This would mark the highest percentage of companies reporting upside surprises since FactSet began tracking this metric in 2008, assuming this beat rate holds through the end of earnings season.
Investors are also continuing to digest reports last week that the Biden administration was eyeing an increase on the capital gains tax rate for individuals earning more than $1 million. The initial reports of this proposal sent stocks plunging on Thursday last week, with traders contemplating the possible net effects of such a move in light of a strengthening economic backdrop that has already helped boost corporate profits.