Tuesday April 19th

19-04-2016

US futures higher as Dow tries to extend gains

Wall Street looked set to open higher on Tuesday, as global stock markets continued rising as a result of steadying crude oil prices. The Dow Jones industrial average on Monday closed above 18,000 for the first time since July and both Asian and European stock indexes traded higher Tuesday. Brent and light crude oil futures held more than 1 percent higher early Tuesday, following a volatile 24 hours. Oil prices originally fell by around 5 percent after the "no-deal" in Qatar over the weekend after recovering partly due to reports that an oil workers' strike in Kuwait could substantially knock output. Brent crude futures, the global benchmark, traded 60 cents higher at $43.51 a barrel at 8:10 a.m. ET (1210 GMT). U.S. crude futures were up 43 cents at $40.21 a barrel. Goldman Sachs reported first-quarter earnings that topped lowered Wall Street expectations, but marked a fourth-straight quarter of profit declines as market volatility hit the company's bond trading and investment banking businesses. Revenue plunged about 40 percent from the year-ago period and missed estimates. Overnight, IBM posted results that beat on both the top and bottom line. However, revenue continued to fall and the firm did not raise its full-year guidance. The stock was about 4 percent lower in pre-market trade. Netflix also disappointed with lower-than-expected subscriber growth for the second quarter. Shares were nearly 9 percent lower in pre-market trade. Other big-name earnings on Tuesday include Intel and Yahoo. Johnson & Johnson also posted quarterly earnings that beat, while revenue matched forecasts. The firm raised its full-year forecast. UnitedHealth reported earnings that beat on both the top and bottom line, and raised its full-year forecast. Shares were nearly 2 percent higher in pre-market trade. Other stocks to watch include eBay, which Morgan Stanley downgraded to "underweight" on Tuesday, citing lackluster buyer and spending growth and rising competition from Amazon. In economic news, housing starts fell a more-than-expected 8.8 percent in March to a seasonally adjusted annual pace of 1.09 million units, the lowest level since October, according to Reuters, citing the Commerce Department. Building permits dropped 7.7 percent to a 1.09 million-unit rate last month, the lowest level since March last year. Treasury yields were mixed, with the 2-year yield little changed near 0.75 percent and the 10-year yield holding higher near 1.78 percent. The U.S. dollar index was slightly lower, with the euro near $1.135 and the yen at 109.2 yen against the greenback as of 8:37 a.m. ET. Late Monday, Boston Fed President Eric Rosengren reiterated in a Reuters report that the Federal Reserve is set hike interest rates more rapidly than priced into futures markets, which see only one modest rate hike in each of the next few years. Most Asian markets gained on Tuesday, led by a jump in Japan shares, as oil prices steadied after Monday's initial drop on producers' failure to reach a production-freeze deal over the weekend. The benchmark Nikkei 225 jumped 598.49 points, or 3.68 percent, to 16,874.44, retracing its 3.4 percent loss in the previous session. Japanese stocks were boosted by a relatively weaker yen against the dollar and as market players digested the extent of damage from last week's earthquakes. Australia's ASX 200 added 51.74 points, or 1.01 percent, to 5,188.80, with the energy and materials subindexes leading gains. In South Korea, the Kospi closed up 2.26 points, or 0.11 percent, at 2,011.36. Hong Kong's Hang Seng index was up 0.76 percent as of 3:14 p.m. HK/SIN time. Chinese mainland markets also advanced, with the Shanghai composite closing up 9.28 points, or 0.31 percent, at 3,042.94, and the Shenzhen composite adding 5.79 points, or 0.29 percent, at 1,958.20. Gold rose 1 percent on Tuesday, lifted by a weaker dollar and a 10-month high for silver, which benefited from robust Chinese buying. Spot Gold and was up 1.55 percent at $1,250.24, while gold futures for June delivery gained 1.4 percent to $1,251.90. Silver climbed 3.5 percent to $16.78, its highest since June 2015, before stabilizing with a 2.52 percent gain at $16.65, having risen by 5.7 percent last week, its biggest weekly jump in 11 months.