Dow futures experienced a modest increase following record closes on Wall Street, as investors weighed robust corporate earnings indicators against escalating geopolitical risks and fluctuations in currency values. A robust outlook stemming from bolstered sentiment, as oil prices maintained weekly gains in the context of rising tensions related to Iran. Simultaneously, a depreciating yen and the continuous stream of earnings reports from significant U.S. corporations maintained market attention on both macroeconomic and corporate factors. Today, a majority of European markets are closed in observance of Labor Day.
Markets continued their upward trajectory, as U.S. equity futures advanced following the closure of major benchmarks at new record highs. In Asia, Japan has shown advancement, whereas the majority of regional markets remained closed for holidays. Apple distinguished itself by providing a revenue forecast that exceeded expectations, despite indicating challenges such as increasing memory-chip costs and persistent supply constraints for Macs that are anticipated to last “several months.” Additionally, it bolstered sentiment with a more favorable outlook for first-half operating income than anticipated. Apple has forecasted robust sales growth for the ongoing quarter and has revealed a $100 billion share repurchase program. Fiscal third-quarter revenue is anticipated to increase by 14%–17%, significantly surpassing Wall Street’s estimates of approximately 9.5%, driven by strong demand for the iPhone 17 and MacBook Neo. In the fiscal second quarter, the company disclosed revenue of $111.18 billion and earnings per share of $2.01, surpassing projections. iPhone revenue reached $56.99 billion, marginally under projections as a result of supply constraints.
Earnings continue to capture attention, with results anticipated from , , and . Barclays strategists indicated this week that “blended Q1 EPS growth is turning up,” while observing that earnings beats are “much stronger in the US than Europe,” highlighting a persistent divergence in regional earnings momentum.
In currency markets, the Japanese yen’s USD/JPY has weakened back toward the 157 level against the dollar, despite recent intervention efforts by authorities in Tokyo. Officials indicated their preparedness to intervene once more, particularly in overseeing markets where speculative activities have led to fluctuations in currency stability. Tim Baker expressed skepticism regarding the likelihood that the pair “will keep falling or even stay here for long,” he argued. “The cross may indeed appear elevated in comparison to rates; however, it is comparatively low when assessed against a straightforward model that incorporates rates, equities, and oil.”
Oil prices maintained a second consecutive weekly increase in the context of rising geopolitical tensions. Donald Trump stated that the U.S. would uphold a naval blockade of Iranian ports, while senior military officials allegedly introduced new options for possible action against Iran, highlighting the risk premium in energy markets. On Thursday, Iran announced its intention to respond with “long and painful strikes” against U.S. positions should Washington resume its attacks, while also reiterating its claim over the Strait of Hormuz.
In corporate developments, OpenAI addressed concerns regarding unmet internal targets, with its CFO highlighting robust execution and “a vertical wall of demand.” In a separate development, S&P Dow Jones Indices has initiated a consultation process that may expedite the integration of newly public mega-cap companies into its benchmarks.