U.S. tech stock futures rallied on Wednesday after another round of searing quarterly earnings – this time from Google parent Alphabet, as investors pared some of their expectations for aggressive rate hikes this year , which hurt the dollar.
Fourth-quarter earnings were mixed even in the tech sector, with PayPal reporting an upbeat outlook on Tuesday, while mega-caps like Apple and Microsoft have so far beat analysts’ expectations.
NASDAQ 100 futures were last up 1.5% on the day, significantly outperforming those of the S&P 500 and Dow Jones, which were trading up 0.8% and 0.1% respectively. .
The next risky event for markets will be Wednesday’s ADP report on private sector payroll growth for January.
“Today’s January report may well be significantly lower due to disruptions from Omicron over the Christmas and New Year period, which saw weekly jobless claims rise sharply,” said Michael. Hewson, chief market strategist of CMC Markets.
Economists expect to see an increase of 184,000, but investors shouldn’t read too much into what that might say about Friday’s monthly jobs report, Hewson said.
In Europe, the Stoxx 600 was up on windfall bank profits. This time it was Spain’s Santander, which reported its highest quarterly underlying profit in 12 years in the final months of 2021. Banking and financial services stocks were among the best-performing sectors on Wednesday. the region.
European investors are awaiting a decision on monetary policy from the European Central Bank and the Bank of England this week. The ECB is under pressure to withdraw monetary stimulus as eurozone inflation figures rise, but the central bank could take a more cautious approach, according to Caxton FX strategist Michael Brown.
“We expect the inflation rate to continue to decline from now into 2022, keeping the ECB at the dovish end of the spectrum,” Brown said.
The dollar fell for a fourth day, in its longest losing streak since last October, as investors cut some of their bets on the
very aggressive monetary policy this year. Weakness in the US currency helped push oil prices back towards $90 a barrel on Wednesday.
Finally, the cryptocurrency market has regained some balance, after a volatile week, with Ethereum’s native token ether up 0.5% in the past 24 hours, while bitcoin is down 0.5%. 0.3% on Wednesday, but still posted a 2% gain over the past week, according to data from CoinMarketCap.