Thursday January 12th

12-01-2017

US futures point to lower open amid Fed speakers, data

U.S. stock index futures pointed to a lower open on Thursday as traders eyed a number of Fed speakers, digested the release of data as well as President-elect Donald Trump's first post-election press conference. Trump shook the broader market temporarily on Wednesday when he criticized the pharmaceutical industry for its pricing practices and the production of drugs outside the U.S. He said he was looking to the industry to bid on drug prices. Investors will keep an eye on a roster of Federal Reserve officials who are speaking at various events for any clues on interest rates and inflation. Philadelphia Fed President Patrick Harker said in prepared remarks three rate hikes are appropriate. Harker, speaking on the economic outlook before the Main Line Chamber in Malvern, Pa., said 2017 is starting off on a "good foot" and inflation expectations are starting to rally. Still, he said monetary policy is a "limited set of tools" and growth policies are up to elected officials. Chicago Fed President Charles Evans and Atlanta Fed President Dennis Lockhart are due to speak at 8:45 a.m. ET in Florida at the American Council of Life Insurers Roundtable, with Lockhart also set to give a speech at the Naples Chamber of Commerce at 12:30 p.m. St Louis Fed President James Bullard will speak in New York at 1:15 p.m., while Dallas Fed President Rob Kaplan is scheduled to speak in Dallas at 1:45 p.m. ET. Fed Chair Janet Yellen will address educators at a town hall meeting in Washington from 7:00 p.m. On the data front, initial jobless claims rose less than expected. On the earnings front, Delta Air Lines reported before the bell, with Infosys set to report after the bell. In Europe, the pan-European Stoxx-600 index was around 0.26 percent lower on Thursday. Japanese shares fell as dollar/yen slipped to a one-month low, after President-elect Donald Trump held a raucous and freewheeling press conference that analysts said was sparse on economic policy details. The Nikkei 225 dropped 1.19 percent or 230 points at 19,134.7, as the yen strengthened against the dollar to 114.25 compared to levels as high as 116 in yesterday's session. A stronger yen is generally bad news for Japanese companies as it makes exports more expensive and lowers repatriated profits earned overseas. Over in mainland China, the Shanghai composite finished down 0.55 percent or 17.12 points at 3,119.6, while the Shenzhen composite closed down 0.87 percent or 17.11 points at 1,951.3. Hong Kong's Hang Seng fell 0.53 percent by mid-afternoon after initially trading positive. Oil prices rose on Thursday, supported by reports that key members of OPEC were starting to cut production and by forecasts of strong demand growth in China. Brent crude futures was up 70 cents at $55.80 a barrel by 7:22 a.m. ET (1222 GMT). U.S. crude was up 58 cents at $52.83. Gold prices surged above $1,200 an ounce to the highest in seven weeks on Thursday as the dollar slumped after U.S. President-elect Donald Trump failed to mention fiscal stimulus in his first news conference. Analysts warned, however, that gold's revival since mid-December may be running out of steam because the dollar was likely to rebound once Trump moves forward with his economic plans. Spot gold was up 1.1 percent at $1,204.04 per ounce by 1130 GMT, after touching a high of $1,206.98, its strongest since Nov. 23. U.S. gold futures rose 0.6 percent to $1,204.10 per ounce.