Tuesday October 13th

13-10-2015

Futures lower after China data

U.S. stock index futures ticked lower on Tuesday, following European and Asian shares downwards, after weak trade data added to concerns about slowing growth in China. Dow Jones industrial average futures were off more than 100 points, while futures for the S&P 500 and Nasdaq also indicated a lower open. China's dollar-denominated exports fell 3.7 percent in September from a year earlier, while imports plunged 20.4 percent to chalk up their eleventh consecutive month of decline, official data showed on Tuesday. "Chinese exports were better-than-expected and imports were slightly worse, but both continued to decline in year-on-year terms," IG's market analyst, Angus Nicholson, said in a report on Tuesday. "It was basically a fairly mixed report, but with last week's impressive rally starting to look stretched, mixed Chinese data was taken as bad Chinese data." In the U.S., traders will await quarterly earnings from Dow Jones industrial average components Intel and JP Morgan Chase after the bell. Earlier in the day, fellow Dow component, Johnson & Johnson, reported earnings that beat but missed on revenue. Separately, the firm announced a $10 billion share repurchase. Shares traded mildly lower in pre-market trade. S&P 500-listed corporations are expected to post a 5.3 percent decline in third quarter 2015 earnings growth, the first third-quarter decline in six years, according to consensus data from S&P Capital IQ. However, excluding the energy sector drag of a sharp negative 65.6 percent, S&P 500 earnings growth would be 2.7 percent. On Tuesday, James Bullard, the president of the Federal Reserve Bank of St. Louis, said in a Dow Jones report that the Fed has effectively met its goals on the labor market and inflation, signaling it's time to start raising rates. Bullard will become a voting member of the Federal Open Market Committee in January. The remarks come after comments from various Fed members over the past couple of days, with the centrist Dennis Lockhart reiterating the case for an interest rate lift-off this year, while Lael Brainard called for no change given downside risks. The day will also bring the Treasury budget for September, as well as a Democrat Presidential debate in the evening. Asian shares outside China slid deeper into the red on Tuesday, with resources names leading losses after latest trade figures rekindled concerns over demand from the world's second-biggest economy. Nikkei sags 1.1%. Japan's benchmark Nikkei 225 index was the victim of profit-taking after an extended weekend, with oil-related counters among the hardest-hit after a more than 5 percent tumble in crude oil prices overnight. Brent crude oil steadied near $50 a barrel on Tuesday after the west's energy watchdog forecast a global supply glut would last through 2016 thanks to slowing demand growth. The International Energy Agency (IEA) said the world oil market would remain oversupplied for at least another year despite falls in output from non-OPEC producers. Global benchmark Brent crude was up 18 cents a barrel at $50.04 by 8:20 a.m. (1220 GMT) on Tuesday as traders bought back into the market after the contract dropped $2.79 in the previous session. U.S. crude was up 19 cents at $47.29 after settling down $2.53 on Monday. Gold fell 1 percent on Tuesday as sellers took advantage of the previous session's three-month high to book profits, though losses were limited by expectations the Federal Reserve will not lift U.S. interest rates this year. Spot gold was down 0.3 percent at $1,159.76 an ounce, while U.S. gold futures for December delivery were down $4.70 an ounce at $1,159.80.