Equity futures are ticking lower as investors look at corporate earnings

Equity futures fell slightly Monday evening as investors looked to build on the momentum of early 2023 and look to more corporate earnings.

Futures linked to the Dow Jones Industrial Average lost 8 points, almost flat. S&P 500 futures fell 0.1%, while Nasdaq-100 futures fell 0.1%.

All three major indices are up after a positive first two weeks of trading in the new year. The Nasdaq Composite leads the way, up 5.9% as investors bought worn-out technology stocks while hopes of an improving landscape for growth stocks rose. The S&P 500 and Dow are up 4.2% and 3.5% respectively since the start of the year.

Gains have been made on the first crop of inflation-linked data that investors say point to a contracting economy, hoping it justifies the Federal Reserve to rein in rate hikes. Last week, the consumer price index for December showed that prices were down 0.1% from the previous month, but prices were still 6.5% higher than in the same month a year ago.

Investors’ attention is now turning to corporate finances as earnings season kicks off. Banks took center stage Friday as investors processed comments about the likelihood of a recession. Goldman Sachs and Morgan Stanley will ring the bell on Tuesday, followed by United Airlines after market close.

“The economic data is friendly, to say the least, which has not served us for the vast majority of the past year,” said Craig Erlam, senior market analyst at OANDA. “The question now is whether the earnings season will bolster that new sense of hope or ruin the party before it really gets going.”

Investors will also be watching closely for news of the World Economic Forum Summit in Davos taking place this week.