Dow Jones Forecast: DJIA steady ahead of more earnings this week

US futures

Dow future 0.10% at 42832

S&P futures 0.3% at 5831

Nasdaq futures 0.50% at 20378

In Europe

FTSE 0.14% at 8263

Dax 0.42% at 19443

• Stocks steady around record high
• More earnings are on tap this week which could test loft valuations
• Boeing falls on job cuts
• Oil falls after OPEC lowers its demand outlook

Stocks steady ahead of more earnings

U.S. stocks are pointing to a muted open on Monday as the market prepares for a week packed with Q3 earnings reports and economic data, which could test lofty valuations.

Major banks kicked off Q3 earnings on Friday on a broadly positive note, with JP Morgan, Wells Fargo, and BlackRock rising following their results.

Gains in these firms helped lift the Dow Jones and the S&P 500 to record closing highs. However, at these levels, the bar is high for earnings as 41 S&P 500 companies are set to report this week.

The U.S. economic calendar is a bit quieter this week, with only US retail sales data due on Thursday. This could provide more clarity over the health of the US consumer.

Several Federal Reserve officials will speak this week, though. Officials Christopher Waller and Neel Kashkari are due to speak today.

The market has reined in expectations of an outsized 50 basis point rate cut in November after a string of stronger expected data and several solid labor market data. Instead, the market is confident that the Fed will cut by 25 basis points.

Today is Columbus Day in the US, which means that the US stock market remains open, although the bond market and banks are closed.

Corporate news

Boeing falls as the plane maker is set to announce it's cutting 17,000 jobs, which equates to around 10% of its global workforce. Boeing also said it would delay its first deliveries of its 777X plane by a year and book $5 billion in losses in the third quarter.

Tesla is set to open over 1% higher, bouncing back from a sharp sell-off last week. The EV manufacturer's robo taxi event disappointed investors with a lack of details.

Dow Jones forecast – technical analysis.

The Dow Jones has been trending higher since April, forming a series of higher highs and higher lows. The price rose to a record high just below 43000 and is hovering around this level. Buyers will look to rise to 43k and beyond. Immediate support can be seen at the 42,400. A break below here negates the near-term up trend. A break below 41,800 creates a lower low.

FX markets – USD rises, EUR/USD falls

USD is rising, adding to gains from the previous week, on expectations that the Fed will adopt a more gradual pace to rate cuts. Volumes could be low due to Columbus Day, which sees the bond market, banks, and post offices close.

EUR/USD is falling with the ECB interest rate decision on Thursday in focus. The ECB is widely expected to cut interest rates by 25 basis points, marking the third cut since June, as inflation has cooled to below the central bank's 2% target and amid rising concerns over the region's growth outlook.

GBP/USD is falling on USD strength and ahead of a busy week for sterling with UK inflation and unemployment data due this week. The data could provide more clues over the future path for interest rates and come after Bank of England governor Andrew Bailey signalled that the central bank could cut rates more aggressively if data allowed it to do so.

Oil falls after OPEC lowers its oil demand outlook

Oil prices are falling on concerns regarding the demand outlook in China. The latest stimulus announcement underwhelmed, and deflationary pressures remain in the world’s largest oil importer.

OPEC released its monthly oil report and downwardly revised its oil demand growth forecast for 2024, reflecting data from this year. It also lowered its projections for next year, marking the third straight downward revision. Play Pack said oil demand will rise by 1.93 million barrels per day in 2024, down from 2.03 million barrels per day it had expected last month. China accounted for the bulk of the downgrades.

Concerns regarding demand overshadowed worries about the Middle East and fears of the conflict broadening out to disrupt supply.