U.S. Stocks Finish Higher Ahead of Earnings Deluge; Bakkt Makes Crypto History
The Dow and broader U.S. stock market traded higher on Monday, as investors prepared for a highly active earnings circuit featuring some of Corporate America’s biggest technology companies.
S&P 500, Nasdaq Rise
Stocks were trading mostly higher Monday, with the S&P 500 Index gaining 0.3% to 2,985.03. The large-cap benchmark fell more than 1% last week.
Gains were mainly concentrated in the information technology sector, which rose more than 1%. Energy, industrials and financials stocks also traded higher to offset declines among consumer discretionary and materials companies.
Surging tech stocks lifted the Nasdaq Composite Index to higher ground. The technology-driven index climbed 0.7% to 8,204.14.
Meanwhile, the Dow Jones Industrial Average edged up 17.70 points, or 0.1%, to finish at 27,171.90.
Earnings in Focus
Corporate earnings season is in full swing this week, with several prominent companies scheduled to report. Dow blue-chips 3M Co (NYSE:MMM), Visa Inc. (NYSE:V) and Verizon Communications Inc. (NYSE:VZ) are all scheduled to report in the coming days.
Amazon.com Inc. (NASDAQ:AMZN), AT&T (NYSE:T) and Snap Inc. (NYSE:SNAP) are also scheduled to release quarterly financial statements.
The first batch of earnings earlier this month put the S&P 500 on track for its second consecutive quarter of year-over-year declines. As of July 12, the estimated earnings decline of the S&P 500 was -3%, according to FactSet.
Corporate America’s earnings outlook has been complicated by a synchronized slowdown in overseas markets, with the International Monetary Fund and World Bank slashing their estimates for global growth. The U.S. economy also hit a snag in the second quarter, with the Atlanta Fed estimating growth at just 1.6% year-over-year.
The U.S. Department of Commerce will release preliminary Q2 GDP data on Friday.
Bakkt’s Bitcoin Futures Platform Begins Testing Phase
Bakkt’s long-awaited bitcoin futures contract will get its first trials on Monday, marking one of the most anticipating launches in the history of crypto.
That’s because, unlike existing bitcoin futures contracts, Bakkt’s platform will deliver physical units of the cryptocurrency upon expiry. The platform is backed by some of Corporate America’s biggest names, including Starbucks and Microsoft, and has already raised $740 million in Series A funding.
The testing phase was first announced June 13 by Adam White, Bakkt’s chief operating officer. Beginning July 22, “Bakkt will initiate user acceptance testing for its bitcoin futures listed and traded at ICE Futures U.S. and cleared at ICE Clear US,” White wrote at the time.
Fundtrat Global Advisors told its clients last week that Bakkt could be ready for launch by the end of the third quarter. For many in the crypto industry, Bakkt is a harbinger for wider institutional adoption that could spearhead the next major bull market.
A September launch would put more bitcoin in the hands of institutional investors roughly eight months out from the next halving event. Read why that’s a big deal.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Chart via Yahoo Finance.