Investing.com - Here are the top five things you need to know in financial markets on Tuesday, October 24:
1. Global Stock Markets Stay Near Recent Highs
While the global stock rally showed signs of slowing, world shares stayed near their recent highs, supported by optimism about global growth prospects.
Asian-Pacific equities ended little changed, holding within striking distance of recent decade highs. Among notable standouts, Japan's Nikkei extended its 16-day winning streak to a 21-year peak while China's blue-chip CSI300 index jumped to the highest in more than two years.
In Europe, bourses and indexes were trading sideways, as a new set of third-quarter earnings pulled companies' stocks sharply in different directions. Germany's DAX held near last week's record highs, while Spain's IBEX 35 dipped as the Catalonia crisis continued to steer Spanish stock performance.
On Wall Street, U.S. stocks pointing to a modestly higher open as investors looked to key earnings reports to set the tone for the markets. On Monday, U.S. stocks declined as each of the major Wall Street indexes retreated from a record.
2. U.S. Earnings Season Gathers Momentum
U.S. earnings season is gathering momentum, with dozens of companies due to report, including Dow components like Caterpillar (NYSE:CAT), McDonald's (NYSE:MCD), United Technologies (NYSE:UTX) and 3M (NYSE:MMM) all out ahead of the opening bell.
General Motors (NYSE:GM), Lockheed Martin (NYSE:LMT), JetBlue (NASDAQ:JBLU), TD Ameritrade (NASDAQ:AMTD), Eli Lilly (NYSE:LLY), Biogen (NASDAQ:BIIB), Corning (NYSE:GLW) and Sherwin-Williams (NYSE:SHW) are also among the handful of names posting results before the open.
After the close, AT&T (NYSE:T), Advanced Micro Devices (NASDAQ:AMD) and Chipotle (NYSE:CMG) release earnings. Texas Instruments (NASDAQ:TXN), iRobot (NASDAQ:IRBT), Akamai (NASDAQ:AKAM) and Express Scripts (NASDAQ:ESRX) are also on the docket.
3. Investors Pivot Focus to Fed Developments
Investors continued to grapple with uncertainty over who will become the next Federal Reserve chair after Janet Yellen's term expires in February and how that will influence the outlook for interest rates.
President Donald Trump has indicated he is "very, very close" to deciding who should chair the U.S. central bank after interviewing five candidates for the position.
These include current Fed Chair Janet Yellen, as well as Fed Governor Jerome Powell, Stanford University economist John Taylor, Trump's chief economic advisor Gary Cohn, and former Fed Governor Kevin Warsh.
The U.S. dollar held near a two-month high against the other major currencies, while bond yields remained supported near their recent peaks
4. Oil Prices Slip as Focus Shifts to U.S. Stockpile Data
Oil prices edged lower as investors looked ahead to weekly data from the U.S. on stockpiles of crude and refined products to gauge the strength of demand in the world’s largest oil consumer.
U.S. crude inventories likely fell by 2.5 million barrels last week, while gasoline and distillate stockpiles also fell, according to a poll of analysts ahead of data by the American Petroleum Institute due at 4:30PM ET (2030GMT).
U.S. West Texas Intermediate (WTI) crude futures lost 0.5% to $51.66 a barrel, while Brent crude futures, the benchmark for oil prices outside the U.S., shed 0.3% to $57.19 a barrel.
Losses were limited as traders weighed disruptions in Iraqi oil production and optimism over output cuts by members of the Organization of the Petroleum Exporting Countries.
5. Euro Zone Private Sector Output Loses Momentum
Private sector growth across the euro zone slowed more sharply than predicted this month, a survey showed on Tuesday, but stayed strong even though firms increased prices at the steepest rate in over six years.
IHS Markit's euro zone Flash Composite Purchasing Managers' Index for October, seen as a good guide to economic growth, fell to 55.9 from September's 56.7. October's reading was below expectations for a more modest dip to 56.5, but was still much higher than it has averaged in recent years.
The report comes just a few days ahead of the European Central Bank policy meeting on Thursday, amid growing expectations that the central bank will announce plans to begin trimming its massive monetary stimulus program.
The euro was a shade higher at 1.1760 against the dollar.