Investing.com -- Wall Street looks set to start the new week on a positive note, as investors digest the implications of the attempt on former President Donald Trump's life, ahead of a deluge of corporate earnings, including from Goldman Sachs, and comments from Fed Chair Jerome Powell.
1. Trump set to receive Republican nomination this week
The 2024 Republican National Convention starts later Monday in Milwaukee, with former President Donald Trump set to receive his party's official nomination just a few days after narrowly escaping an attempted assassination.
Trump is likely to be nominated as the party’s frontrunner for the presidential race, with many analysts speculating that the shooting has actually increased his chances of a victory over President Joe Biden.
The assassination attempt has also appeared to have lowered the pressure from congressional Democrats for Biden to step aside in the race amid concerns about his fitness for office, as the party pulls together.
Some Democrats in the House of Representatives and Senate have publicly called upon Biden to drop out in the aftermath of his shaky performance in a June debate against Trump.
Both leaders counseled calm over the weekend, aiming to lower temperatures in a country whose deep political divide has grown even more pronounced during the presidential race.
2. Futures rise with earnings, Powell in focus
U.S. stock futures rose Monday as investors await a big week of corporate earnings as well as comments from Fed Chair Jerome Powell.
By 04:00 ET (08:00 GMT), the Dow futures contract was 135 points, or 0.3%, higher, S&P 500 futures climbed 17 points, or 0.3%, and Nasdaq 100 futures rose by 88 points, or 0.4%.
The second-quarter earnings season [see below] will be in focus this week–more than 40 S&P 500 companies are reporting–with investors wondering if the results will be strong enough to push the indices higher, given they are already at record levels.
The Dow Jones Industrial Average hit a fresh all-time high above 40,000 on Friday, adding to the record highs the broad-based S&P 500 index and the tech-heavy Nasdaq Composite registered last week.
Fed chief Jerome Powell will also be in the spotlight, as he is set to be interviewed by David Rubenstein at the Economic Club of Washington DC.
In his recent testimony on Capitol Hill, Powell highlighted the central bank's ongoing efforts to tackle inflation and its commitment to a dual mandate, and investors will be looking for more clues over a potential cut in interest rates in September.
3. Goldman leads off earnings week
The U.S. quarterly earnings season continues this week, with investment bank Goldman Sachs (NYSE:GS) set to release its numbers later in the session after a number of its rivals started the ball rolling late last week.
The expectations will be high after Citigroup (NYSE:C) and JPMorgan (NYSE:JPM) reported huge growth in investment banking revenues, even if Wells Fargo 's (NYSE:WFC) decline in net interest income disappointed investors.
Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS) are expected to follow as the week progresses, as well as Netflix (NASDAQ:NFLX), the first of the tech giants that have driven much of the equity gains this year.
Second-quarter earnings for S&P 500 companies are expected to have jumped 10.1% year-over-year, based on LSEG data as of Friday, accelerating from 8.2% growth in the first quarter.
S&P 500 earnings growth has been improving since a year-over-year decline in the second quarter of 2023, largely because of growth in tech-focused companies and optimism over artificial intelligence.
4. China’s economic growth showed in Q2
China's economic growth slowed in the second quarter, data showed on Monday, as a protracted property downturn weighed heavily on domestic demand.
The world's second-largest economy grew 4.7% in April-June, its weakest growth since the first quarter of 2023, and down from the 5.3% expansion in the previous quarter.
Separate data showed that China's industrial output rose 5.3% in June from a year earlier, slowing from 5.6% in May, while retail sales, a gauge of consumption, rose 2.0% in June, slowing significantly from a 3.7% increase in May.
This weakness places the focus on China's third plenum, a seminal event typically held every five years which starts on Monday, amid expectations Beijing will need to unleash more stimulus to support the economy.
5. Crude stable despite weak Chinese economic data
Crude prices stabilized Monday, with weak Chinese data balanced by raised political uncertainty.
By 04:00 ET, the U.S. crude futures (WTI) dropped 0.1% to $80.94 a barrel, while the Brent contract fell 0.1% to $84.95 a barrel.
The world's second-largest economy registered its weakest growth since the first quarter of 2023,
Additionally, China's crude oil imports fell 2.3% in the first half of this year to 11.05 million barrels a day, amid disappointing fuel demand.
This data indicates the country is facing increased economic headwinds, and this is likely to bode poorly for crude demand in this vitally important market.
That said, losses have been limited with political uncertainty in the U.S. and the Middle East supporting prices.