Stock futures gain on deal to avert government shutdown, trade hopes

[February 12, 2019]   By Amy Caren Daniel

(Reuters) - U.S. stock index futures rose on Tuesday, as sentiment was lifted after lawmakers reached a tentative deal to avert another partial government shutdown and the United States and China expressed optimism about their ongoing trade talks.

However, it was unclear if President Donald Trump would embrace the agreement as congressional aides said it did not contain the $5.7 billion he wants for a border wall.

The U.S.-China trade talks resumed on Monday as both sides attempt to strike a deal before the March 1 deadline, when additional U.S. tariffs on Chinese imports will come into force.

U.S. Trade Representative Robert Lighthizer arrived in Beijing on Tuesday ahead of high-level talks scheduled later this week.

Trade-sensitive industrial bellwethers rose in premarket trading. Boeing Inc and Caterpillar Inc were both up about 1 percent each, while chipmakers, which get a huge chunk of their revenue from China, also gained.

Advanced Micro Devices Inc, Micron Technology Inc and Nvidia Corp rose between 1 percent and 1.8 percent.

At 6:48 a.m. ET, Dow e-minis were up 212 points, or 0.85 percent. S&P 500 e-minis were up 19.75 points, or 0.73 percent and Nasdaq 100 e-minis were up 61 points, or 0.88 percent.

With two-thirds of S&P 500 companies reporting, the fourth-quarter earnings season has entered the home stretch. So far, 71.2 percent have posted better-than-expected profits.

A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., February 8, 2019. REUTERS/Brendan McDermid

But first-quarter profit growth expectations have dipped. Analysts now see quarterly earnings dropping 0.2 percent from last year, which would mark the first contraction since the second quarter of 2016.

Gilead Sciences Inc fell 3.8 percent after a late-stage study of a key experimental drug to treat a progressive fatty liver disease failed to meet its main goal.

Under Armour Inc rose 1.4 percent after the sportswear maker reported quarterly profit that beat Wall Street estimates as it sold more sneakers at full price during the holiday season.

Electronic Arts Inc jumped 5.8 percent after the videogame maker said its newly launched battle royal game "Apex Legends" crossed more than 25 million players.

Economic data on tap includes the JOLTS job openings numbers for December due at 10 a.m. ET. The numbers are forecast to have risen to 6.900 million from 6.888 million in November.

(Reporting by Amy Caren Daniel and Shreyashi Sanyal in Bengaluru; Editing by Sriraj Kalluvila)

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