Fed Day, Tesla Earnings

Good morning contrarians! Welcome to the Daily Contrarian, our morning look at events likely to move markets. It is Wednesday, Jan. 29. Fed Day. Also Tesla (TSLA 0.00%↑) earnings day.

State of Play

Stocks rallied yesterday, led by a rebound in tech. The Nasdaq gained 2% as semiconductor stocks rallied, not quite recapturing the losses from Monday but close enough. As we eye our board of indicators for signs of direction at 0645, there is very little to go by:

• Stock index futures are effectively unchanged. The Nasdaq is pointing to a gain of 0.4% at the open. S&P 500 flat;

• Cryptos are flat as a board. Bitcoin is unchanged trading around $102,500;

• Not much going on in commodities land either. WTI crude oil is down 0.7% to trade around $76/barrel. Copper is unchanged;

• Bonds also flat. The 10-year yields 4.53%.

Today’s Known Events

We once again have some earnings to kick things off:

• ASML Holding (ASML 0.00%↑) overnight reported results that beat analyst estimates and that stock is surging in the pre-market, up 7%;

• General Dynamics (GD 0.00%↑) reports before the open.

Focus then turns to the Fed. The US central bank is widely expected to keep its key policy rate unchanged at 4.50%. But there are a lot of questions surrounding this decision, the first under the new/old president. There is also the question of the long-term outlook. Fed fund futures aren’t pricing in a rate cut until June. Could today provide something that changes that narrative?

After the close the focus will return to earnings. Some heavy hitters here:

• Tesla (TSLA 0.00%↑)

• Microsoft (MSFT 0.00%↑)

• Meta (META 0.00%↑)

Those are the highlights people will be talking about.

(Fed, Tesla compete for investor attention today. Image by author via Grok AI)