The S&P 500 gained 0.5% on Tuesday, yet it wasn't a resounding gain. There was a lot of good earnings news, highlighted by results from Alphabet (GOOG), Biogen (BIIB), and United Technologies (UTX), yet the advance-decline line actually favored declining issues at both the NYSE and Nasdaq by a comfortable margin.
Alas, while the good earnings news was broad-based, market internals suggested the buying interest on Tuesday was not. What saved the session for the broader market were the gains registered by many of its mega-cap stocks, like Alphabet and Apple (AAPL).
Today, there is no life saver. That doesn't mean the market is going to drown, but it will start today's session a bit underwater.
The S&P futures are down four points and are trading 0.1% below fair value. The Nasdaq 100 futures are up one point and the Dow Jones Industrial Average futures are down 80 points.
The disparate move by the Dow futures can be attributed primarily to the weakness expected in shares of Boeing (BA), which are indicated 3.9% lower.
Boeing topped second quarter estimates, yet the aircraft manufacturer simply reaffirmed its full-year core EPS guidance of $14.30-14.50, the high end of which happens to fall short of analysts' average expectation.
It won't be pretty at the start either for shares of General Motors (GM) and Fiat Chrysler (FCAU). Those stocks are down 5.3% and 7.8%, respectively, after both companies issued earnings warnings for FY18.
Ford (F) is slated to report its results after today's close along with Facebook (FB).
Some hesitancy in front of Facebook's report has also tempered buying efforts this morning, yet market participants are probably also hung up on the recognition that European Commission President Juncker and President Trump will be meeting at 1:30 p.m. ET to discuss trade matters.
In particular, the crux of the meeting will revolve around auto tariffs; and the onus is reportedly on Mr. Juncker to convince President Trump not to implement a 25% tariff on imports of autos and auto parts from the EU.
President Trump has set a high bar, suggesting the EU should drop all trade barriers, tariffs, and subsidies, but conceded that he doesn't think the EU will do this.
That's why the market is on edge wondering if Mr. Juncker's proposals will be enough to placate the president and avoid what economists think would create a serious drag on growth prospects if the U.S. imposed stiffer tariffs on imports of autos and auto parts from the EU, which the EU has already said would precipitate countermeasures.
The stock market isn't apt to respond well if there is a perception the meeting didn't go well. Conversely, the seeds of a relief rally should flourish from a reportedly positive outcome.
In the meantime, the New Home Sales Report for June at 10:00 ET (Briefing.com consensus 670,000; Prior 689,000) will occupy some of the market's attention along with the EIA's crude oil inventory report at 10:30 ET.
Oil prices are up 0.1% to $68.59 per barrel following a weekly report from the American Petroleum Institute showing a 3.16 mln barrel drawdown in crude stockpiles for the week ending July 20.
That fits in line with the measured move in the U.S. Dollar Index this morning (-0.1% to 94.50), the measured move in the 10-yr note (-1 bp to 2.94%), and the measured move in the S&P futures (-0.1% below fair value).
In other words, the broad market action is, uh, measured, as participants seem to be in a wait-and-see mode.