U.S. stock-index futures rose Friday, pointing to the potential for a fourth straight win for equities, as investors hung on to optimism over a report that Washington might ease tariffs on Chinese goods.
Equity markets will be closed on Monday in observance of Martin Luther King Jr. Day.
How are benchmarks faring?
Dow Jones Industrial Average futures
YMH9, +0.62%
rose 153 points, or 0.6%, to 24,476; S&P 500 futures
ESH9, +0.46%
gained 11.55 points, or 0.5%, to 2,647; and Nasdaq-100
NQH9, +0.54%
futures added 36 points, or 0.5%, to 6,756.25.
On Thursday, the Dow
DJIA, +0.67%
erased an earlier loss to rise 162.94 points, or 0.7%, to 24,370.10 in choppy trade. The blue-chip gauge was up 267 points at its session high. The S&P 500 index
SPX, +0.76%
added 0.8% to 2,635.96 and the Nasdaq Composite Index
NQH9, +0.54%
gained 0.7% to finish at 7,084.46.
For the week as of Thursday, the Dow and S&P 500 are each up 1.5% and the Nasdaq Composite is looking at a gain of 1.6%.
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What’s driving the market?
Stocks got a late lift Thursday after The Wall Street Journal reported that U.S. officials were debating a possible ease in tariffs on Chinese imports, to give Beijing incentive to make deeper concessions over the trade dispute.
A Treasury spokesman immediately walked back the report, telling the newspaper that any bargaining positions remained “at the discussion stage.” The source also said neither Treasury Secretary Steven Mnuchin nor U.S. Trade Representative Robert Lighthizer have made any specific trade-related recommendations, and talks were still ongoing.
Nevertheless, markets remain optimistic that the initial report, rather than the subsequent denial, reflected the administrations true approach.
Meanwhile, investors continue to digest a new round of earnings reports, like those from Netflix Inc
NFLX, +0.51%
, which reported strong subscriber and profit growth, but missed on revenue. The stock is trading down in the premarket, but its 32% rise year-to-date reflects the glass-half-full sentiment that has overtaken markets in recent weeks.
What’s driving the market?
“With the shutdown slowly taking 0.1 percentage points of GDP each week, the president knows a victory in resolving the trade war can give him leverage on continue his battle with Democrats on his border wall funding,” wrote Edward Moya, market analyst at OANDA in a Friday morning note.
“Yesterday’s Wall Street Journal report that Treasury Secretary Steven Mnuchin reportedly proposed the idea of lifting some or all the tariffs gave stocks a strong bid. It was quickly refuted by the Treasury, but story shows how anxious markets are in looking for positive momentum to continue with trade talks,” he added.
“From an earnings standpoint, results continue to be better than feared,” Tom Essaye, president of the Sevens Report wrote in a Friday-morning note to clients. “Industrials have posted solid results so far in earnings season, and that is a positive if it continues throughout the rest of the season.”
Meanwhile, the “market continues to act resiliently,” in the face of any bad news, like Morgan Stanley’s disappointing earnings, he wrote.
What data and Fed speakers are ahead?
At 9:05 a.m. Eastern Time, New York Fed President John Williams, a voting member of the rate-setting Federal Open Market Committee, will give a speech on the economic outlook and monetary policy to the New Jersey Bankers Association in Somerset, New Jersey.
At 9:15 a.m., the Federal Reserve will release its estimates of industrial production and capacity utilization. At 10 a.m., the University of Michigan will release the preliminary reading of its consumer confidence index for January.
Philadelphia Fed President Loretta Mester, a nonvoting member of the FOMC, will give a speech on the future of Philadelphia at 11 a.m.
Which stocks are in focus?
Tesla Inc.
TSLA, +0.36%
shares were falling in premarket trade after the company announced job cuts and warned on profits.
Netflix Inc.
NFLX, +0.51%
shares were down 2.4% before the bell Friday, indicating investor dissatisfaction with the streaming video service giant’s fourth-quarter results and upbeat calls from Wall Street analysts. The pullback comes after a massive run-up in the share price over the past few weeks.
Shares of American Express Co.
AXP, +0.08%
were down 2.2% before the bell on Friday, after the financial-services company reported mixed fourth-quarter results Thursday evening.
SunTrust Banks Inc.
STI, +1.19%
stock was up 3.4% in premarket action, after the bank reported better-than-expected profits.
Shares of Tiffany & Co.
TIF, +1.49%
were up 0.1% in light, premarket trade, the luxury jewelry retailer reported holiday-period sales that declined from a year ago and provided a downbeat full-year profit and sales outlook.
Eli Lilly and Co.
LLY, +2.02%
stock was down 2.4% before the bell, Friday, after the company said a late-stage trial of a treatment for sarcoma failed to meet its main goals.
Shares of VF Corp.
VFC, +1.86%
rose nearly 10% in premarket trade Friday, after the parent company of Vans and The North Face reported better-than-expected earnings and sales.
How are other markets trading?
Markets in Asia surged, led by a 1.4% jump for China’s Shanghai Composite Index
SHCOMP, +1.42%
In Europe, the Stoxx Europe 600
SXXP, +1.52%
rose 1.5%.
Crude oil
CLG9, +1.15%
was also moving higher, while gold
GCG9, -0.74%
is falling and the U.S. dollar
DXY, -0.03%
was steady.
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Source : MTV
