U.S. Stock Futures Muted to Start a New Week

Pre-market futures are up to start a fresh trading week, though indexes are currently coming down from where they were earlier in early-morning trading. The Dow is currently +70 points, the S&P 500 is +10, the Nasdaq has gained +25 points thus far and the small-cap Russell 2000 keeps its catch-up trade levels, +13 points at this hour. We remain off highs from the first half of the month, but those also happen to be all-time highs.

Q2 Earnings Ahead of the Bell: CLF, DPZ

U.S.-based steelmaker Cleveland-Cliffs CLF outperformed expectations on both top and bottom lines this morning, with a slimmer-than-expected loss of -$0.50 per share an improvement over the -$0.68 projected. Revenues of $4.93 billion bettered the Zacks consensus by +0.62%. Shares are up +4.5% on the news. During the quarter, a 50% tariff was slapped on foreign steel imports, but the view forward is cloudier on trade policy. \

Domino’s Pizza DPZ had a mixed performance in its Q2 results this morning, missing by -3% on its bottom line with earnings of $3.81 per share (its second miss in its last three quarters) but improving on revenues above expectations to $1.15 billion, +4.3% year over year. Shares are up +3% in pre-market trading, +11% year to date. 

U.S. LEI Comes Out After Market Opens

The U.S. Leading Economic Indicators (LEI) report for June hits the tape after the opening bell this morning, with expectations for a further drift downward to -0.2% from May’s -0.1%. In last month’s report, Average Consumer Expectations for Business Conditions fell nearly as far as the S&P 500 index rose.

Most LEI numbers have been negative over the past six months, with moving goalposts regarding tariff policy have kept business owners on their heels somewhat. In the May report, a recession signal was triggered — referenced somewhat in last week’s extraordinary interview with Zacks Chief Economist John Blank in the Zacks Market Edge podcast.

What to Expect from the Stock Market This Week

Q2 earnings season heats up in a serious way, with more than 20% on the S&P 500 scheduled to report before the end of this trading week. Headliners come Wednesday, after the closing bell, with Google parent Alphabet GOOGL and challenged EV leader Tesla TSLA both reporting quarterly results.

Alphabet carries a Zacks Rank #3 (Hold) as of this morning, and is expected to see advertising revenues improve. Earnings are expected to have risen +13.2% in the quarter, with overall revenues +11.1%. Tesla has a Zacks Rank #4 (Sell) rating with a Value-Growth-Momentum grade of “F” as of this morning; expectations for its Q2 earnings are -23.1% year over year, and -11.9% on the revenue side.

Also this week, even though we lighten up from last week’s heavy dollop of economic reports, Existing & New Home Sales, S&P flash Services and Manufacturing PMI and Durable Goods Orders are all expected to be released. Expectations are mixed for these data points; we look forward to some of this murkiness lifting upon results being revealed.

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This article originally published on Zacks Investment Research (zacks.com).

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