Jan 27 - U.S. equity futures were mixed on Tuesday as traders positioned ahead of a large slate of quarterly earnings. Contracts tracking the S&P 500 and the Nasdaq climbed, while Dow E-minis trailed following a notable decline in insurer shares.
UnitedHealth shed 8.6% after the Trump administration proposed a modest increase in payment rates to Medicare insurers. The company was also scheduled to release its quarterly results before the opening bell. Fellow insurers saw steep losses as well, with Humana sliding 13.7% and CVS Health falling 9.4%.
At 05:22 a.m. ET the futures board showed Dow E-minis down 40 points, or 0.08%, S&P 500 E-minis up 17.25 points, or 0.25%, and Nasdaq 100 E-minis higher by 140 points, or 0.54%.
Investor attention was centered on a wide range of corporate bellwethers set to report results, including UPS, Boeing, General Motors and American Airlines. All four were scheduled to publish earnings before the bell, forming part of a broader cadence of reports that will dominate market focus over the coming days.
In total, 102 companies in the S&P 500 are due to report this week. Of the 64 that had already announced results as of Friday, 79.7% exceeded analyst expectations, according to data compiled by LSEG. The coming releases include high-profile tech names: Meta Platforms, Microsoft and Tesla were all scheduled to report on Wednesday, kicking off results from the so-called "Magnificent Seven." Those reports will serve as a key test of the AI-driven trade that has supported much of Wall Street's rally in recent months.
Investors will scrutinize company forecasts and leadership commentary, particularly around capital expenditures and plans to monetize AI-related initiatives, to assess whether the momentum behind the AI trade remains intact. Market participants have noted signs of crowding into mega-cap AI beneficiaries, and some of that money has rotated into small-cap and other undervalued areas in recent weeks. The Russell 2000 index has climbed over 7% this month, and the S&P 600 small-cap index has advanced 6.5%, compared with a 1.5% gain for the benchmark S&P 500.
On the policy front, the Federal Reserve began a two-day meeting on Tuesday. Market consensus largely expected policymakers to hold the target federal funds rate in the 3.5% to 3.75% range. Attention will focus on guidance from the Fed about the likely duration of restrictive policy settings. Traders will also be alert to any commentary that could hint at leadership developments at the central bank, although officials were not expected to directly address speculation about the next Fed chair.
Consumer confidence data for January was scheduled for release at 10:00 a.m. ET, with consensus estimates pointing to an increase to 90.9 from 89.1 in December.
Market participants were also keeping an eye on political risks. The prospect of a partial U.S. government shutdown loomed ahead of the January 30 funding deadline. Separately, heightened scrutiny of federal immigration enforcement followed a second fatal shooting by federal agents in Minneapolis, developments that add to near-term uncertainty for risk assets.
In other stock moves, Salesforce rose 2.2% after winning a $5.6 billion contract from the U.S. Army. The contract award was cited alongside the company's stock reaction ahead of broader earnings-driven market moves.
Summary
Futures rose for the S&P 500 and Nasdaq on Jan. 27 as investors prepared for heavy earnings flow, while insurers tumbled after a proposed adjustment to Medicare insurer payment rates. The Fed began a two-day meeting with rates expected to remain at the current 3.5% to 3.75% range, and markets awaited company guidance on capital spending and AI monetization plans.