S&P500 Forecast: SPX set for a quiet start ahead of Fed minutes, NVDA earnings

US futures

Dow future 0.01% at 40,00

S&P futures 0.05% at 5326

Nasdaq futures 0.34% at 18559

In Europe

FTSE 0.06% at 8425

Dax 0.35% at 18779

• US stocks muted after last week’s record highs
• Fed speakers support higher rates for longer
• Nvidia in focus ahead of its earnings this week
• Oil steady despite Iran’s President’s fatal crash

FOMC minutes & Nvidia earnings is focus this week 

US stocks are pointing to a modestly higher open after record levels were reached last week and as investors look ahead to FOMC minutes as well as Nvidia earnings later in the week.

The three major indices booked their fourth straight week of gains last week amid upbeat corporate earnings and after weaker-than-expected inflation data, which raised expectations that the Federal Reserve would cut rates this year.

The S&P500 and the tech-heavy NASDAQ 100 both touched all-time highs last week, while the Dow Jones closed above 40,000 on Friday.

The US economic calendar is quiet today, with attention on Federal Reserve speakers whose views will be considered ahead of the minutes from the FOMC meeting, which will be released on Wednesday.

Despite inflation cooling, recent Fed speakers have said that rates need to stay high for longer. The market is currently priced in an 82% probability that the Fed will cut rates by at least 25 basis points in September.

Earnings season is slowing down after a strong run. 78% of the companies that have reported are posting earnings that exceed expectations. Attention is also turning to Nvidia earnings, which are due this week.

Corporate news

Nvidia is set to reopen 1.4% higher as investors look ahead to this week's quarterly earnings amid very high expectations of another round of solid results for the AI darling.

Paramount Global is set to open 2% higher after the New York Times reported that Sony and Apollo Global Management have signed non-disclosure agreements allowing them to look at U.S. media company's books ahead of possible bids for its assets.

Li Auto is on track to open over 4% lower after the Chinese EV maker unveiled a disappointing forecast for current-quarter revenue and lower deliveries.

S&P500 forecast – technical analysis.

The S&P 500 has extended gains above 5277, the April high, reaching a fresh ATH of 5326 on Thursday. This is the level that buyers will look to retake to extend gains towards 5400. Immediate support is seen at 5277, the April high. Below here 5200, last week’s low comes into focus and 5160 the 50 SMA.

FX markets – USD rises, GBP/USD falls

The USD is rising after the market digests the latest comments from Federal Reserve speakers as officials emphasize keeping interest rates higher for longer.

EUR/USD It's hovering around 1:09 amid an upbeat market mood and after the euro has performed strongly in recent sessions amid questions over whether the  ECB will extend its monetary policy tightening spell beyond June. ECB's Isabel Schnabel said she remains uncertain about whether the central bank will extend rate cuts after June. While the ECB is set to cut rates in June, the path beyond that remains uncertain.

GBP/USD Is falling after Bank of England's vice governor Ben Broadbent said UK interest rates may drop this summer if inflation continues to ease. His comments come ahead of UK CPI data on Wednesday and after BoE governor Bailey noted that the rate could be cut as soon as next month.

Oil steady despite Iran’s President’s fatal crash.

Oil prices are holding steady around $79 after solid gains across the previous week and as the market remains little changed after the death of Iran's president and amid the Saudi King's ill health. Political uncertainty in major oil-producing companies has risen after the Iran president died in a helicopter crash and as Saudi Arabia's Crown Prince deferred a trip to Japan due to his father's health.

Oil prices remain unchanged as investors await more clarity from OPEC regarding its production forecast. The next OPEC+ meetings are on June 1st.