Futures near record on trade deal, robust earnings
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[January 16, 2020] By
(Reuters) - U.S. stock index futures
hovered near all-time highs on Thursday on optimism over an initial
U.S.-China trade deal and a positive start to the fourth-quarter
The blue-chip Dow Jones Industrial Average <.DJI> closed above the
29,000 mark for the first time and the benchmark S&P 500 <.SPX> hit a
record high on Wednesday after U.S. President Donald Trump and Chinese
Vice Premier Liu He signed the long-awaited trade pact.
China is expected to boost purchases of U.S. goods and services in
exchange for the rolling back of some tariffs as part of the deal, but
concerns remain with several thorny issues still unresolved.
The deal eased a worry that had kept investors on edge for over a year
and helped them focus on quarterly earnings.
Wall Street bank Morgan Stanley <MS.N> wrapped up earnings from big
lenders with a better-than-expected quarterly profit, powered by its
investment management, bond trading and underwriting businesses. Its
shares gained 1.9% in premarket trading.
Analysts expect earnings at S&P 500 companies to have dropped 0.5% in
the fourth quarter, according to Refinitiv IBES data, the second
At 7:18 a.m. ET, Dow e-minis <1YMcv1> were up 83 points, or 0.29%. S&P
500 e-minis <EScv1> were up 11.25 points, or 0.34% and Nasdaq 100
e-minis <NQcv1> were up 38.75 points, or 0.43%.
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Traders work on the floor at the New York Stock Exchange (NYSE) in
New York, U.S., January 10, 2020. REUTERS/Brendan McDermid
Shares of semiconductor stocks, including Micron Technology Inc <MU.O> and
Advanced Micro Devices Inc <AMD.O>, were up about a percent after a promising
outlook from the world's top contract chipmaker TSMC <2330.TW> <TSM.N> pointed
to a recovery in the chip sector.
TSMC is considered a proxy for global tech demand as its clients include Apple <AAPL.O>,
Qualcomm <QCOM.O> and Huawei <HWT.UL>.
A slew of economic data including retail sales, Philly Fed business index and
weekly initial jobless claims numbers are due at 8:30 a.m. ET.
Retail sales is expected to have increased 0.3% in December, compared to 0.2%
rise in November. The numbers will be of particular interest after Target Corp <TGT.N>,
Kohl's Corp <KSS.N> and J.C. Penney Co Inc <JCP.N> all reported disappointing
Signet Jewelers Ltd <SIG.N> was a bright spot, jumping 16.8% after raising
adjusted earnings estimate for 2020 on the back of upbeat holiday season sales.
Tesla Inc <TSLA.O> fell 3.1% after Morgan Stanley downgraded the stock to
"underweight" from "equal weight".
(Reporting by Sruthi Shankar in Bengaluru; Editing by Sriraj Kalluvila)
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