Eos Energy stock falls after Fuzzy Panda issues short report
- US index futures steady while Europe trades lower ahead of the ECB rate decision.
- Tech earnings and Fed signals keep investors cautious, but sentiment remains broadly positive.
- Stronger US–China relations ease global tensions, supporting risk assets and stock market stability.
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US index futures were little changed while European markets fell in early European trading. US investors juggled a muddled mix of tech earnings, the Fed’s cautious tone, and optimism over US–China relations.
President Donald Trump called his meeting with Xi Jinping “amazing”, with both sides agreeing to roll back some export restrictions and trade barriers – though markets had more or less priced that in already, which is why we didn’t see a major reaction.
Still, the removal of one of the major sources of uncertainties should be good news for risk assets, you’d think. So stocks could rise even further, barring a major negative surprise from the remainder of the tech companies set to report their results.
Tech Earnings In Focus
Some of the big tech companies reported their results, and more to follow today. Meta (NASDAQ:META) tumbled nearly 8% as investors fretted over its lavish AI spending spree, while Alphabet (NASDAQ:GOOGL) surged more than 7% thanks to surprisingly strong cloud growth.
Microsoft (NASDAQ:MSFT), meanwhile, saw its share slide in premarket after its results failed to cheer. Amazon and Apple are still to report – both due after today’s close and likely to set the tone for the next leg of the rally.
Analysis: Stocks to Remain Supported Despite the Hawkish Fed
It’s fair to say the mood has cooled slightly after global indices notched record highs on AI euphoria. But the improved trade prospects and hopes of easier central bank policy should keep markets on the front foot.
For all Powell’s caution, the Fed’s stance isn’t exactly shocking. So, a bit of hesitation from the central bank shouldn’t be enough to derail what is still a very sturdy uptrend in equities. Interestingly, stocks haven’t really blinked despite Powell sounding a touch more hawkish. That tells you something – the AI earnings story is what’s really keeping the S&P 500 aloft, not the prospect of easier money.
The latest batch of tech earnings was a mixed bag, yes, but revenues are still holding up well. With Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN) still to come, we’ll soon find out whether the tech-led rally still has legs or if investors start demanding a new narrative.
Powell’s press conference made one thing crystal clear – there’s a bit of discord brewing within the Fed. That hint of internal division gave the dollar a lift, with markets trimming around 10 basis points off expected rate cuts.
The greenback firmed most against the low-yielding yen and Swiss franc, while commodity currencies took heart from the improving tone in US–China relations. However, stocks’ initial dip was quickly bought, even as Powell reiterated that a December cut isn’t a “foregone conclusion.”
Hopes for More Constructive US–China Ties
After months of friction, the Trump–Xi summit finally delivered what markets had hoped for – a truce, at least for now. Both sides walked away with something to show for it: a one-year freeze on new trade escalations and a commitment to dial down tensions. That alone removes a major source of uncertainty for businesses and investors. In theory, this should be good news for the stock markets, you would think.
ECB in Focus as French GDP Surprises
This morning’s Eurozone growth figures brought a pleasant surprise – at least from France. Despite political uncertainty, French GDP accelerated 0.5% quarter-on-quarter, easily topping forecasts. The contrast with Germany, however, couldn’t be starker. Europe’s industrial powerhouse flatlined in Q3, though a technical recession was narrowly avoided. That shouldn’t cause the ECB to cut rates, however, and no one is expecting them to do so.
S&P 500 Technical Analysis and Trade Ideas
It is clear that the S&P 500 remains in a bullish trend. With the index continuing to make higher highs and higher lows, while the pullbacks are minimal and short-loved, this is a clear sign the uptrend is strong. A true reversal would need a decisive break below key support levels and a confirmed topping pattern, neither of which we’ve seen yet. With that in mind, dip-buying continues to remain the name of the game, even at these levels.
For now, immediate support sits around 6,785 to 6812 on the S&P 500 futures chart — roughly in line the highs from earlier in the month, and the 21-day exponential moving average. Below these levels, you have 6722 as the next important level, then a short-term trend line coming in around the 6,650-6,660 area.
On the upside, initial resistance comes in near 6950ish, where the index has spent the last two and a half days or so without breaking further higher. A clear move above this level would bring the big 7000 mark into focus, which is where I think the index is headed.
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Disclaimer: This article is written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel or recommendation to invest as such it is not intended to incentivize the purchase of assets in any way. I would like to remind you that any type of asset, is evaluated from multiple perspectives and is highly risky and therefore, any investment decision and the associated risk remains with the investor.