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Aug 4, 2016

U.S. Stock Market Future Indications Update, by MarketWatch - August 4, 2016: U.S. Stocks Set to Rise After Bank of England Expand Stimulus

marketwatch.com

Barbara Kollmeyer


Wall Street stocks were poised to open higher Thursday after the Bank of England on Thursday cut its key interest rate for the first time in seven years and expanded its quantitative-easing program.

Adding to earlier gains, Dow Jones Industrial Average futures YMU6, +0.26%  rose 52 points, or 0.2%, to 18,321, while those for the S&P 500 index ESU6, +0.22%  added 5.5 points to 2,162.50. Nasdaq-100 NQU6, +0.09%  futures went from earlier losses to gains, up 5.5 points to 4,733.50.
The rise in stock futures built after the BOE cut its key interest rate by 25 basis points to a record low of 0.25%, which met market expectations. However, the central bank also said it would buy up to £10 billion ($13.18 billion) of corporate bonds and expand its quantitative-easing program by £60 billion to £435 billion.
Check out: Live blog of the Bank of England decision and press conference
“The UK’s QE easing policy decision could spur more appetite over in the US for equites. Traders will feel confident that bank is not using any kind of excuse and tackling the problem with all the tools which are at their disposal,” said Naeem Aslam, chief market analyst at Think Markets UK, in emailed comments.
The British pound GBPUSD, -1.1857%  extended losses, dropping to $1.3143 in the wake of the decision, compared with from $1.3325 late Wednesday. The FTSE 100 index UKX, +1.51%  jumped 1.4%. The U.K.-year gilt yield TMBMKGB-10Y, -15.10%  was driven to record lows.
Eyes on oil: The Dow Jones Industrial Average DJIA, +0.23%  broke a seven-session losing streak on Wednesday, rising 41.23 points, or 0.2%, to 18,355, thanks in part to a rally in crude prices.
Crude-oil prices CLU6, -0.51% fell 12 cents to $40.71 a barrel, with analysts keeping a close eye on the $41-a-barrel level. The Energy Information Administration data reported a surprise 3.3 million-barrel fall in gasoline inventories, which helped U.S. crude rally to $40.83 a barrel on Wednesday.
“Oil has once again established itself as the central thematic behind the world’s financial markets and the fact we saw such a powerful reversal at the trend low, despite U.S. dollar strength, has driven a slight uplift in sentiment,” said Chris Weston, chief market strategist at IG, in a note.
In the U.S., weekly jobless claims data are coming at 8:30 a.m. Eastern, followed by factory orders at 10 a.m. Eastern. Claims data comes a day ahead of the July nonfarm payrolls report. Economists polled by MarketWatch expect jobs growth of 185,000 after 287,000 jobs were created in June and 11,000 in May.
Stocks to watch: Ahead of the open, Restaurant Brands International QSR, +0.65% reported profit and revenue that fell short of estimates, while Viacom Inc. VIAB, +0.78% VIAB, +0.78% posted better-than-expected earnings and sales, sending shares 1% higher in premarket. VIAB, +0.78% SeaWorld Entertainment Inc. SEAS, +3.27%  met earnings forecasts, but fell short on revenue as it reported attendance down.
Priceline Group Inc. PCLN, +1.91% Kellogg Co. K, -0.96% are still ahead.
Digital-payments company Square Inc. SQ, +3.88%  shot up 17% after raising its revenue guidance for the year.
Read: Square earnings give Jack Dorsey an actual growth story
Tesla Motors Inc. TSLA, -0.62%  shares eased slightly in premarket after the electric-car maker’s reported a bigger-than-expected second-quarter loss, and the company promised 50,000 car deliveries in the second half of the year.
Read: Elon Musk: Tesla isn't really a money-losing business
TripAdvisor Inc. TRIP, +0.12%  missed targets as hotel revenue fell, sending shares down 7% in premarket.
Transocean Ltd.’s RIG, +3.98%  quarterly profit dropped sharply as revenue was nearly halved, but results beat expectations and shares of the oil driller rose 0.5% ahead of the bell. Herbalife Inc. HLF, +0.37%  swung to a second-quarter loss, but lifted its outlook. Shares weren’t active ahead of the open. GoDaddy Inc. GDDY, -3.51%  wasn’t active either after rising 7% in late-session trading as the seller of web addresses posted a narrower quarterly loss on a revenue jump.
Other markets: Asian markets ADOW, +0.63%  finished higher, inspired by gains for oil prices. In Europe, the Stoxx Europe 600 index SXXP, +0.84%  rose 0.8%.
Gold prices GCU6, +0.07%  turned lower, down slightly to $1,364.30 an ounce.