Stock futures fell after hitting record levels

Stock futures fell slightly on Monday evening after a record session.

The S&P 500, Dow and Nasdaq all rose to new highs Monday as corporate earnings results beat expectations and defied concerns about ongoing supply chain constraints, shortages and cost pressures.

Clorox (CLX) became one of the most recent major names for top estimates in results released Monday after the closing bell, as the cleaning supplies and household goods company topped its third-quarter sales and earnings estimates and reaffirmed its full-year guidance even as the company said that Expect “continued cost pressures”. Shares of Avis Corporation (Opinion) and Simon Property Group (SPG) also, as both companies posted quarterly earnings that beat expectations after the market closed.

Heading into this week, the expected earnings growth rate for the S&P 500 was at 36.6% for the third quarter, which while backtracking from the second-quarter rate, would still represent the third-highest pace in data extending into 2010, according to FactSet.

“I don’t think what’s happening is too surprising” when it comes to the impressive annual earnings growth many companies reported for the third quarter, Sean O’Hara, president of the Pacer ETF, told Yahoo Finance Live. “I think what we need to see going forward is, is it sustainable, or are some of these external factors going to be a bigger challenge than we anticipate?”

“Is inflation and the input costs that producers are dealing with, is that going to derail things? Is it a shortage of workers?” he added. “There are a lot of things that could derail the market, especially as you’re making this transition from where we are, which is easily comparable to last year, to things that are much more difficult going forward.”

In addition to the strong corporate earnings backdrop, continued economic recovery and the still-positioned position of monetary policy makers have helped prop stocks on their march to new highs. For investors, the Federal Reserve’s latest monetary policy decision on Wednesday will help suggest how long the central bank will maintain its current support levels. Many experts expect to see the bank begin to roll back the asset purchases that included the quantitative easing program that helped support the recovery, with new economic data reflecting the US economy approaching pre-pandemic conditions.

“We think better days are coming. Earnings are still growing at a very healthy clip. A lot of people are focusing on peak growth rates. That’s probably not the way to look at it,” said Samir Samana, senior global markets analyst at Wells Fargo. , for Yahoo Finance Live. “In our view, it’s these low interest rates, still stimulus policy and really strong growth that set the stage for strong stocks next year.”

6:07 p.m. ET Monday: Lower edge of stock futures

Here is where the markets were trading as the evening session began:

  • S&P 500 futures contracts (ES = F.): -2 points (-0.04%) to 4,603.75

  • Dow futures contractsYM = F.): -18 points (-0.05%) to 358,782.00

  • Nasdaq futures contractsNQ = F.): -16.25 points (-0.1%) to 15878.00

A street sign for Wall Street is seen outside the New York Stock Exchange (NYSE) in New York City, New York, US, July 19, 2021. REUTERS/Andrew Kelly

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter

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