Key Things to Know Before the Stock Market Opens Monday

1. Ending on a Positive Note

All major indexes surged last Friday, capping off a volatile week on a high note. The Dow Jones Industrial Average soared by 1.64%, ending the day at 40,589.34. The S&P 500 and Nasdaq Composite also rose, gaining 1.11% and 1.03% to close at 5,459.10 and 17,357.88, respectively. The Russell 2000, an index focusing on small-cap stocks, jumped by 1.67%. These gains were fueled by June’s personal consumption expenditures (PCE) price index, which showed a modest 0.1% monthly increase and a 2.5% rise year-over-year, aligning with economists' expectations. This positive data bolstered investor confidence heading into the new week.

2. Busiest Week of Earnings Season

This week is set to be the busiest for earnings reports, with about 160 S&P 500 companies announcing their quarterly results. Big names like Advanced Micro Devices and Microsoft are scheduled to report early in the week, while Apple and Amazon will release their results on Thursday. These reports are critical as tech giants have been under pressure from a shift towards small-cap stocks, which lagged in the first half of the year. Investors are keenly watching these earnings to gauge the health and direction of the tech sector.

3. President Biden’s Supreme Court Proposal

President Joe Biden has unveiled a significant proposal aimed at reforming the U.S. Supreme Court. Dubbed the “No One Is Above the Law Amendment,” this three-part plan includes term limits for justices, a binding ethics code, and a constitutional amendment to ensure presidents can be prosecuted for crimes committed while in office. This proposal follows a recent Supreme Court ruling granting former President Donald Trump immunity for official acts performed during his presidency. The reform also addresses concerns about justices, like Clarence Thomas and Samuel Alito, receiving undisclosed financial gifts.

4. Fast Food Chains Revive Value Meals

In response to changing consumer spending habits, fast-food chains like McDonald’s, Taco Bell, Burger King, and Wendy’s are bringing back discounted meals. As menu prices soared, these chains saw a drop in customer visits, particularly among low-income patrons. While these value meals are expected to attract more customers, Wall Street is cautious about the potential impact on the companies' profits. KeyBanc analyst Eric Gonzalez noted that the second quarter might see many large chains missing consensus estimates due to this strategy.

5. Record-Breaking Box Office

Marvel’s “Deadpool & Wolverine” has shattered box office records, opening with $205 million in domestic ticket sales. This is the highest debut of 2024 and the largest opening for any R-rated film in history, far exceeding analysts’ expectations of $160 million to $180 million. The film also garnered $233.3 million internationally, totaling $438.3 million for its opening weekend. This massive success underscores the enduring appeal and resilience of the movie theater experience, even in the face of streaming competition.

Market Movers to Watch

U.S. stock futures rose on Monday, buoyed by a mix of corporate news and economic updates. McDonald’s stock climbed 0.9% despite a surprise drop in quarterly global comparable sales, as overall revenues increased slightly. Occidental Petroleum’s stock edged up 0.3% following the sale of Delaware Basin assets for $818 million. Apple’s stock fell 0.2% due to delays in incorporating AI features into its products. Abbott Laboratories saw a 6.2% drop after being ordered to pay $495 million in damages. Tesla’s stock rose 1.4%, bolstered by positive notes from analysts. Philips' ADRs jumped 10% after reporting strong second-quarter results, and Coinbase’s stock rose 4% on the back of higher Bitcoin prices.