Monday July 16th

16-07-2018

Stocks set for flat open as earnings season kicks into high gear

U.S. stock index futures were little changed on Monday as the corporate earnings season was in full swing. Dow Jones Industrial Average futures rose just 13 points, indicating a gain of 15.59 points at the open. S&P 500 and Nasdaq 100 futures also hovered around the flatline. BlackRock reported second-quarter earnings and revenue before the bell, along with Bank of America and J.B. Hunt. BlackRock's earnings were driven in part by a lower corporate tax rate, while Bank of America got a boost from cost cuts and lower taxes. J.B. Hunt's results were helped by higher rates and increased volume. Streaming giant Netflix is set to report Monday after the close. Wall Street has high hopes for this earnings season, with analysts expecting second-quarter profits to have grown by 20 percent from last year, according to FactSet. Investors also looked to Helsinki as President Donald Trump and Russia's Vladimir Putin had their first official dialogue. The meeting comes just days after the U.S. Justice Department announced that special counsel Robert Mueller had acquired an indictment, that charges a dozen Russian intelligence officers with hacking Democrats to interfere in the U.S. election in 2016, and with stealing information of around half a million U.S. voters. On the economic front, sales at retailers nationwide grew 0.5% last month, the government said Monday. That matched the MarketWatch forecast of economists. The increase last month followed an even bigger burst of spending in May, when sales grew a revised 1.3% instead of previously reported 0.8%. Retail sales have increased 6.6% over the past 12 months, slightly above the long-run average since 1980. Business inventories will then be released at 10 a.m. ET. Asian stocks closed lower on Monday as investors digested the release of a barrage of China economic data, shrugging off the gains seen stateside in the previous session. The Shanghai composite declined 0.61 percent to close at 2,813.92 as investors digested the release of a barrage of economic data, including China's second-quarter GDP growth of 6.7 percent which met expectations. That was a tad below the 6.8 percent growth seen in the previous quarter. The smaller Shenzhen composite was little changed, ending the session lower by 0.1 percent. Meanwhile, Hong Kong's Hang Seng Index shed 0.17 percent by 3:02 p.m. South Korean stocks closed lower, with the Kospi slipping 0.39 percent to 2,301.99. Meanwhile, markets in Japan were closed for a holiday on Monday. Oil prices slipped on Monday as concerns about supply disruptions eased and Libyan ports reopened while traders eyed potential supply increases by Russia and other oil producers. But global supply remained tight with investors wary over the impact of production losses in several exporting countries. "There are mixed supply signals," said Kim Kwang-rae, analyst at Samsung Futures. Brent crude was down 30 cents at $75.03 a barrel by 0750 GMT. U.S. light crude was down 50 cents at $70.51. Gold prices recovered from a seven-month low on Monday, as the dollar traded below its recent highs and after sluggish GDP data from China weighed on Asian stocks. Spot gold was up 0.2 percent at $1,242.86 an ounce at 0730 GMT, after marking the lowest since Dec. 12 at $1,236.58 on Friday. U.S. gold futures for August delivery were about 0.2 percent higher at $1,243 an ounce.