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Futures muted, Apple's iPhone 16 launch, Oracle results - what's moving markets

Published 10/09/2024, 05:58 pm
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Investing.com -- US stock futures were muted on Tuesday, with traders gearing up for major US inflation data later in the week and attempting to assess the outlook for Federal Reserve monetary policy. Apple (NASDAQ:AAPL) unveils its latest artificial intelligence-enhanced iPhone, while Oracle's (NYSE:ORCL) first-quarter earnings top estimates, sending shares in the cloud company sharply higher prior to the opening bell.

1. Futures muted

US stock futures mostly hovered around the flatline on Tuesday, suggesting a reversal from gains posted on Wall Street in the prior session, as investors eyed an upcoming inflation report and potential Federal Reserve interest rate cuts.

By 03:42 ET (07:42 GMT), the Dow futures contract and S&P 500 futures were broadly unchanged, and Nasdaq 100 futures had shed 33 points or 0.2%.

The main averages rose on Monday, with traders hunting for bargains after a sell-off in the previous week fueled in part by a weaker-than-anticipated August jobs report and sluggish manufacturing data.

Markets are attempting to gauge the outlook for Fed monetary policy in the wake of the figures, with a cut to borrowing costs at the central bank's meeting on Sept. 17-18 now all but guaranteed. However, it remains uncertain if policymakers will roll out a 25-basis point or 50-basis point reduction. More clarity could come on Wednesday, when the latest US consumer price index -- a key measure of inflation -- is set to be released.

In individual stocks, Boeing (NYSE:BA) shares climbed after the embattled planemaker reached a tentative labor deal with its largest union, while Palantir (NYSE:PLTR) and Dell Technologies (NYSE:DELL) both jumped after it was announced that both firms will be joining the benchmark S&P 500 index on Sept. 23.

2. Apple unveils AI-enhanced iPhone 16

Shares in Apple were mostly unchanged in extended hours trading after the tech giant revealed the latest iterations of its flagship iPhone on Monday, with analysts stating that the new, artificial intelligence-powered features lacked any big surprises.

The Cupertino-based group announced a slew of enhancements in its iPhone 16, including improvements to its Siri voice assistant and a range of smart camera customizations aimed at professional video editing.

Analysts said the new iPhones and AI features were largely in line with expectations set by Apple’s earlier reveal of its plans for a push into AI, called “Apple Intelligence.” But some analysts warned that the new features will be released gradually, possibly detering immediate buyers, especially amid tough competition from rivals such as Samsung (KS:005930) and Huawei.

Apple is banking on the iPhone 16, which is due to go on sale on Sept. 20 with pre-orders available this Friday, to help reinvigorate flagging sales of the device.

3. Oracle tops quarterly forecasts

Shares in Oracle rose sharply in after-hours trading after the group reported better-than-expected fiscal first-quarter results, driven by strong demand for its cloud business.

The Texas-based cloud services company also said it signed a partnership with Amazon (NASDAQ:AMZN) Web Services that will allow customers to access Oracle Autonomous Database and Oracle Exadata Database Service within AWS.

Oracle posted adjusted earnings per share (EPS) of $1.39 on revenue of $13.3 billion in the three months ended on Aug. 31. Analysts polled by Investing.com had anticipated EPS of $1.33 on revenue of $13.23 billion.

Total remaining performance obligation, a key measure of booked revenue, came in at $99 billion, up 53% compared to the year-ago period.

For its second quarter, the company projected revenue growth of 8% to 10%, topping analysts' estimates of 8.72% at the midpoint, according to LSEG data cited by Reuters.

4. Chinese exports grow by more than expected in August

Exports from China increased by more than anticipated in August, potentially indicating that companies are ramping up orders prior to tariffs expected from a number of trading partners.

The country's outbound shipments grew 8.7% year-on-year, above expectations of 6.5% and accelerating from a 7% rise seen in July, according to government data. It was the fastest rate since March 2023.

However, imports expanded by 0.5%, missing estimates of 2% and slowing from 7.2% in July, suggesting that domestic demand remains sluggish in the world's second-biggest economy.

The numbers suggest that firms may be attempting to lock in orders early due to signs that China could be facing mounting foreign tariffs. Analysts at Capital Economics said in a note that exports are "likely to remain strong in the coming months" as "more barriers against Chinese goods are being erected."

5. Oil dips

Oil prices inched lower in European trade on Tuesday as concerns over weak domestic demand in China outweighed the possible impact of Tropical Storm Francine on US oil production.

Brent oil futures expiring in November were down 0.4% at $71.53 a barrel, while West Texas Intermediate crude futures had dipped by 0.4% to $67.61 per barrel by 03:33 ET. Both benchmarks settled higher on Monday.

A slew of oil companies, including Exxon Mobil (NYSE:XOM), Shell (LON:SHEL) and Chevron (NYSE:CVX), are moving to halt production and refining activities in the Gulf of Mexico due to Tropical Storm Francine. The storm is expected to strengthen in the coming days, according to the National Hurricane Center.

But sentiment has been dented by a string of weak economic readings from China, which have drummed up fears over tepid growth in the world's top oil importer.

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