Wall St closes higher ahead of Fed meeting, big tech earnings

NEW YORK – United States stocks advanced on Jan 29 as market participants looked ahead to this week’s slew of megacap earnings, economic data and the Federal Reserve’s monetary policy meeting.

All three major US stock indexes advanced, with the tech-laden Nasdaq enjoying the largest percentage gain.

The S&P 500 notched yet another record closing high.

With the bellwether index up more than 3 per cent so far in the first month of 2024, BlackRock raised its overall US stocks view to “overweight” from “neutral”.

“Today is the calm before the storm,” said Mr Ryan Detrick, chief market strategist at Carson Group in Omaha.

“This is a truly headline-driven week, with earnings, the Fed, the jobs report and ongoing geopolitical uncertainties,” he added.

“So with stocks at all-time high, if we see any disappointments, that could upset the apple cart and cause some well-deserved volatility.”

A spate of earnings from high profile tech and tech-adjacent momentum stocks waits in the wings, starting on Jan 30 with Alphabet and Microsoft, Qualcomm on Jan 31 and culminating on Feb 1 with Apple, Amazon.com and Meta Platforms.

Other closely watched results include General Motors on Jan 30, Boeing on Feb 1, with oil supermajors Exxon Mobil and Chevron wrapping up the week on Feb 2.

The Federal Open Markets Committee is scheduled to convene on Jan 30 for its two-day monetary policy meeting, at which its voting members are widely expected to leave the key Fed funds target rate unchanged at 5.25 to 5.50 per cent.

Fed Chair Jerome Powell and other policymakers have warned not to expect interest rate cuts before inflation cools down to its average 2 per cent annual target, but have also vowed to remain agile as they respond to economic data.

Mr Detrick said: “Powell is probably going to be somewhat cautious. The Fed doesn’t want to be burned by inflation, and will push back on the (expected) March cut as a near certainty.”

This week’s roster of economic reports includes the labour market, with the Job Openings and Labour Turnover Survey, ADP, fourth-quarter employment costs, productivity and planned layoffs, and the January employment report on Feb 2.

Case-Shiller home prices, consumer confidence, the Institute for Supply Management’s purchasing managers’ index, construction spending and factory orders are also on deck.

Robust economic data of late – particularly last week’s strong gross domestic product and personal consumption expenditures data – have simultaneously calmed fears of imminent recession and tossed cold water on hopes that the Fed would begin cutting interest rates as soon as March.

Tesla gained after the electric carmaker revealed capex plans.

Robot vacuum maker iRobot dropped as Amazon scrapped merger plans in the face of opposition from European Union antitrust regulators.

Meta advanced after brokerage Jefferies raised its target price on the stock to US$455 from US$425.

Warner Bros Discovery slipped as brokerage Wells Fargo downgraded the streaming platform to “equal weight” from “overweight”.

Financial technology firm SoFi Technologies surged after posting a fourth-quarter profit. REUTERS