Futures edge up, earnings this week - what's moving markets

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Futures edge up, earnings this week - what's moving markets

Investing.com -- Stock futures on Wall Street inch higher to begin the trading week, with investors digesting the implications of recent economic data on future Federal Reserve policy decisions and looking ahead to a fresh batch of corporate earnings. Elsewhere, China's Ant Group wins approval from Beijing to release its AI model to the public, while the cash pile at Warren Buffett's Berkshire Hathaway (NYSE: BRKa ) swells to a record high.

1. Futures point higher

U.S. stock futures edged up on Monday after equities on Wall Street posted their best week of trading so far this year.

By 04:52 ET (09:52 GMT), the Dow futures contract had added 28 points or 0.1%, S&P 500 futures moved up by 7 points or 0.2%, and Nasdaq 100 futures rose by 30 points or 0.2%.

Bond yields fell and the main indices rallied in the prior session following the release of weaker-than-anticipated U.S. employment data for October, bolstering investors' hopes that the Federal Reserve could refrain from further monetary policy tightening in the coming months.

Yields on the 2-year U.S. Treasury note touched a two-month low on Friday, while the 10-year yield hit its lowest mark in over five weeks. Prices tend to move inversely to yields.

The 30-stock Dow Jones Industrial Average climbed by 0.7%, the benchmark S&P 500 jumped 0.9%, and the tech-heavy Nasdaq Composite increased by 1.4%, lifting all three to their most winning weeks since 2022.

2. SoftBank, Walt Disney among key earnings this week

Japan's SoftBank (TYO: 9984 ) is due to unveil its latest quarterly results on Thursday, with traders keen to see how the tech investment behemoth has been impacted by the listing of its chip designer Arm.

The bumper initial public offering of U.K.-based Arm in September raked in about $4.9 billion for SoftBank, which offered 9.4% of Arm but retained a more than 90% stake in the company.

Arm's Nasdaq debut came after a multi-year push by SoftBank and its billionaire boss Masayoshi Son to cash out on some of its holdings in a company whose hardware powers nearly all of the world's smartphones. Markets will likely to be curious to see what other deals Son is now eyeing.

Walt Disney (NYSE: DIS ), which is also set to report earnings this week, could face questions over plans for its crucial theme parks unit. Attendance reportedly slowed over the summer, in a possible sign that visitors were souring to elevated admission prices.

Maximizing profits at the parks business is key for Disney as it moves to offset losses at its legacy television division and high costs from an ongoing transition into streaming services.

Other firms providing financial updates this week include D.R. Horton (NYSE: DHI ), Occidental Petroleum (NYSE: OXY ), and Wynn (NASDAQ: WYNN ).

3. China signs off on public release of Ant Group's AI model

Beijing has approved the mass-market use of an artificial intelligence (AI) large language model designed by Jack Ma-founded fintech firm Ant Group.

Unlike other governments, new regulations in China require that AI models, including Ant Group's Bailing product, undergo and pass security assessments before they are made available to the wider public.

In a statement on Monday, the affiliate of e-commerce group Alibaba (NYSE: BABA ) said that it is working to complete applications that utilize the model and will release them soon.

Ant Group, which announced a finance-related large language model in September, is racing against Chinese peers like Baidu (NASDAQ: BIDU ) and ByteDance to roll out and monetize AI.

Elsewhere, Elon Musk announced on Saturday that his AI start-up has released its first AI chatbot, dubbed "Grok." Musk said the system would have access to his X social media platform (formerly known as Twitter), adding that it would "love sarcasm" and have "a little humor."

4. Buffett's Berkshire Hathaway cash pile swells

Berkshire Hathaway's cash pile jumped to a record high of $157B in the third quarter, according to a filing over the weekend.

Billionaire Warren Buffett's Berkshire offloaded $5.3B in U.S. and foreign stocks during the three-month period, although it remained unclear how the so-called "Oracle of Omaha" rejigged the company's portfolio. Both fund managers and the broader public typically keep close tabs on Buffett, who is widely viewed as one of the world's best investors.

While the share sales give the firm fresh powder for possible acquisitions, they were also seen as a sign that the Nebraska-based group is cautiously gauging stock valuations and the broader market environment during a time of high borrowing costs and political strife.

5. Oil jumps amid tight supply picture

Oil prices rose Monday, rebounding after last week’s hefty losses, with traders encouraged by the prospect of tighter supplies.

Major suppliers Saudi Arabia and Russia confirmed over the weekend that they will maintain their ongoing supply reductions until the end of the year, heralding tighter oil markets.

By 04:53 ET, the U.S. crude futures traded 1.5% higher at $81.70 a barrel, while the Brent contract climbed 1.3% to $86.03 per barrel.

Both benchmarks slumped about 6% last week as the geopolitical risk premium faded, with the Israel-Hamas war failing, so far, to escalate into a wider conflict in the Middle East.

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