Tuesday October 16th

15-10-2019

US futures point to a higher open on solid start to earnings season

U.S. stock index futures were higher Tuesday morning, after a number of major companies posted big earnings beats. Around 8:45 a.m. ET, Dow futures indicated a positive open of about 83 points. Futures on the S&P and Nasdaq were both also higher. Earnings season kicked off with stronger-than-expected results from J.P. Morgan Chase, Johnson & Johnson, UnitedHealth, BlackRock, and Citigroup, sending shares higher in the premarket. Shares of Goldman Sachs and Wells Fargo fell, however, after its earnings missed Street estimates. United Airlines and Interactive Brokers will release earnings after the bell. Meanwhile, market players are monitoring developments on the trade front. U.S. Treasury Secretary Steven Mnuchin told CNBC that tariffs will go up in December if there is no deal in place with China. “I have every expectation if there’s not a deal those tariffs would go in place, but I expect we’ll have a deal,” Mnuchin said Monday. Furthermore, the U.S. has also decided to stop trade negotiations with Turkey and raised its steel prices to 50%. The decision followed an earlier U.S. announcement to remove all U.S. troops from the northern border of Syria with Turkey. On the data front, the New York Empire State manufacturing figures are due to be released at 8:30 a.m. ET. Asia Pacific markets traded cautiously on Tuesday, following the previous day’s rally, as new doubts emerged overnight about the partial U.S.-China trade deal. In South Korea, the Kospi index closed fractionally higher at 2,068.17. Japan’s Nikkei 225 jumped 1.87% to 22,207.21 and the Topix index added 1.56% to 1,620.20 after Japanese markets were closed Monday for a public holiday. Chinese mainland markets fell: The Shanghai composite slipped 0.56% to 2,991.05, the Shenzhen composite declined 1.1% to 1,641.94 and the Shenzhen component was down 1.17% to 9,671.73. Hong Kong’s Hang Seng index declined 0.11% in late-afternoon trade. Oil prices fell further on Tuesday, after heavy losses in the previous session following two days of weak Chinese data and as investors continued to fret over prospects for a U.S.-China trade deal despite signs of a truce last week. Brent crude fell $0.44, or nearly 1%, to $58.94 a barrel, while U.S. West Texas Intermediate (WTI) crude dropped 55 cents, or 1%, to $53.05. Gold steadied on Tuesday, moving in a tight range, after hopes of progress in U.S-China trade talks were tempered and ahead of a summit that will determine how Britain leaves the European Union. Palladium hit a record high, continuing its stellar run driven by a sustained supply crunch. Spot gold edged up 0.1% to $1,494.29 per ounce. U.S. gold futures rose 0.1% to $1,498.40.