Deutsche Bank strategists report the S&P 500 closed at a fresh record, supported by strong earnings and tech leadership, even as most constituents declined. Futures now point lower as the Iran conflict and higher Oil prices weigh on risk sentiment. Upcoming US PMIs and jobless claims are seen as key tests for the resilience of US equities.

Earnings strength versus Oil shock

"US equities actually performed quite strongly yesterday, with the S&P 500 (+1.05%) closing at a new record high. That got support from corporate earnings, and Boeing (+5.53%) was one of the top performers in the index after their cash outflow was smaller than expected by analysts."

"Otherwise, tech stocks did well, with the NASDAQ (+1.64%) reaching a new record of its own, while the Philadelphia Semiconductor index (+2.72%) posted a record 16th consecutive advance. That said, the breadth of the advance was quite narrow, with most of S&P 500’s constituents falling on the day."

"After the US close, Tesla was the first of the Mag 7 to report earnings, with its shares initially rising by almost 5% on a solid earnings beat, but this gain was erased by the end of after-hours trading as executives unveiled that capex will exceed $25bn this year, roughly three times last year’s level. Meanwhile, IBM’s shares slumped by -7% after hours as its software revenues only just met analyst expectations."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)