US stock indexes are expected to climb to new record highs on Wednesday as oil prices consolidate after a sharp recent fall and investors prepare for another packed round of corporate earnings, including Eli Lilly, Disney, Uber, SanDisk and Western Digital.
Dow Jones and S&P 500 futures both were pointing 0.4% higher, extending all-time highs, while Nasdaq futures were up 0.2% as SpaceX and AMD shares fell sharply in pre-market trading
The prior session saw record closes for the S&P and Dow as lower energy prices eased inflation concerns and revived appetite for risk. West Texas Intermediate crude has edged up 0.4% to $76.09 a barrel in early trading, with the US oil price having fallen sharply from around $85 at the end of last week to a three-week low below $75 overnight, as hopes grow for an agreement to restore shipping through the Strait of Hormuz. Technology sentiment cooled slightly, with AMD shares down 8.8% in pre-market trading despite forecasting third-quarter revenue ahead of consensus.
SpaceX is down 10.8% following the release of earnings overnight, the first since listing, more than reversing the previous day’s gain. As NASA confirmed that a discarded part of one of the company’s rockets has crashed into the moon, market analyst Russ Mould at AJ Bell says “as visual metaphors go [just] hours after it had delivered its debut quarterly earnings feels almost too on the nose”. He said the shares fell as investors fretted about the “heavy AI spending revealed in the results”, with the “significant difference between SpaceX and some of the other free spending participants in the AI arms race is that it does not yet generate meaningful levels of cash flow” On the earnings call, CEO Elon Musk suggested Starlink could build a terrestrial mobile network to compete with the likes of T-Mobile, AT&T and Verizon.