Monday April 8th

8-04-2019

Dow futures slide as mood turns cautious ahead of earnings season

U.S. stock index futures were lower Monday, with market participants worried about what is likely to be a tough earnings season. At around 8:35 a.m. ET, Dow Jones Industrial Average futuresindicated a negative open of more than 100 points. Futures on the S&P 500 and Nasdaq 100 were both marginally lower. Market focus is largely attuned to corporate results, with major U.S. banks set to get the ball rolling later in the week. Analysts have warned that the upcoming earnings season could be the first quarter of contracting corporate results since 2016. J.P. Morgan Chase and Wells Fargo are both set to report their latest figures on Friday. Before that, minutes from the Federal Reserve's last meeting are due to be released on Wednesday. Following the Fed's most recent meeting in March, the central bank decided to maintain interest rates and hold off on any further increases this year. President Donald Trump said Friday the U.S. economy would climb like a "rocket ship" if the U.S. central bank cut interest rates. He complained the Fed had "really slowed us down" in terms of economic growth and that "there's no inflation." Unlike the White House, the Fed did not conclude in March that slowing global growth means the bank should begin cutting rates. On the data front, factory orders for February will be published at around 10 a.m. ET. Asia Pacific markets were mixed on Monday as investors digested better-than-expected jobs data in the U.S. and reports of progress in trade negotiations between Washington and Beijing. Mainland Chinese stocks were mostly lower on the day, with the Shanghai composite declining slightly to 3,244.81 and the Shenzhen composite falling 0.551% to 1,770.20. The Shenzhen component, on the other hand, was 0.11% higher at 10,351.86. Meanwhile, Hong Kong's Hang Seng index gained 0.32% in its final hour of trading. In Japan, the Nikkei 225 slipped 0.21% to close at 21,761.65 as index heavyweight Fanuc declined 0.74%. The Topix also shed 0.35% to finish at 1,620.14. Over in South Korea, the Kospi closed fractionally higher at 2,210.60. Oil prices rose to their highest level since November 2018 on Monday, driven upwards by OPEC's ongoing supply cuts, U.S.sanctions against Iran and Venezuela, fighting in Libya as well as strong U.S. jobs data. International benchmark Brent futures were up 31 cents at $70.65 per barrel around 8 a.m. ET (1200 GMT) on Monday, up 28 cents, or 0.4 percent from their last close. U.S. West Texas Intermediate crude were up 27 cents at $63.35 per barrel. Brent and WTI both hit their highest since November at $70.86 and $63.53 a barrel, respectively, early on Monday. Gold prices rose to a more-than-one-week peak on Monday as the dollar slipped after data showed U.S. wage growth slowed last month, while investors awaited minutes of the U.S. Federal Reserve's March meeting later this week. Spot gold gained 0.4 percent to $1,296.87 per ounce by 0746 GMT, after touching its highest since March 29 at $1,297.86 earlier in the session. U.S. gold futures were also up 0.4 percent at $1,301 an ounce.