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Jan 18, 2017

U.S. Stock Market Future Indications - January 18, 2017: Stock Futures Edge Higher as Investors Await Yellen Speech

marketwatch.com
 
Joseph Adinolfi, Barbara Kollmeyer
 
Stock futures on Wednesday pointed to a marginally higher open as investors digested earnings reports from Goldman Sachs Group and Citigroup Inc. Investors also are awaiting an important report on inflation as well as a speech from Federal Reserve Chairwoman Janet Yellen.

Dow Jones Industrial Average futures YMH7, +0.12%  rose 30 points, or 0.2%, at 19,760, while those for the S&P 500 index ESH7, +0.14%  edged up 4 points, or 0.2%, to 2,264.75. Nasdaq-100 index futures NQH7, +0.18%  gained 11.25 points, or 0.2%, to 5,051.50.
Other economic data will garner attention, including a reading on consumer prices and a home builders’ index scheduled for later in the New York morning.
Mike Antonelli, an equity sales trader at R.W. Baird & Co., said global stocks would likely remain placid until investors have a better picture of the fourth-quarter, corporate-earnings environment
The bulk of S&P 500 firms will release their earnings in the coming weeks.
“We’re just coasting off of 2016 right now. With the lack of wind in our sails we’ve slowed down a bit,” Antonelli said.
Healthy consumer-sentiment readings have been helping to constrain stock-market gains, Antonelli said. Early Wednesday, U.S. Investors Intelligence, a market research firm, said its consumer-sentiment gauge—which relies on interviews with market newsletter writers—had reached an 18-month high.
“It’s hard for the market to go higher when everybody is already bullish,” he said.
Transportation and retail stocks were headed for a rough session after CSX Corp. CSX, -1.83% a railroad operator, posted disappointing quarterly earnings and Target Corp. TGT, +1.07%  warned that its fourth-quarter earnings would be weaker than previously anticipated.
J.C. Penney Co. Inc. JCP, +2.66%  shares sank in premarket trade after the troubled retailer on Tuesday announced a new partnership with Nike Inc. NKE, +1.38%  to add Nike shops in 600 of its stores.
U.S. stocks retreated Tuesday as the market turned its attention to comments from President-elect Donald Trump, who said a strong dollar is harming the U.S. economy. The Dow Jones Industrial Average DJIA, -0.30%  finished 0.3% lower at 19,826.77, the S&P 500 index SPX, -0.30%  fell 0.3% to 2,267.89 and the Nasdaq Composite Index COMP, -0.63%  lost 0.6% to 5,538.73.
Trump also criticized the North Atlantic Treaty Organization and warned that the U.S. one China policy, a diplomatic protocol that has been in place since the 1970s, could be up for negotiation.
The Trump comments took a toll on the greenback, which was recovering some ground Wednesday. The WSJ Dollar Index BUXX, +0.49%  rose 0.5% to 91.37, from 91.16 late the prior session. The index fell 1.1% Tuesday.
Read: Trump is waving adios to the longstanding ‘strong-dollar policy’
Economic docket: Readings on consumer prices at 8:30 a.m. Eastern Time, and on industrial production and capacity utilization at 9:15 a.m. Eastern, all for December. The National Association of Homebuilders’s housing market index for January follows at 10 a.m. Eastern, while the Fed’s Beige Book is due at 2 p.m. Eastern.
The consumer-prices report should be closely watched. Economists polled by MarketWatch are forecasting a monthly rise of 0.2% for core inflation and 0.3% for headline inflation.
“Solid inflation data should resuscitate speculations of a hawkish Fed, while a soft read wouldn't be dramatic, given that the rising inflation expectations under Donald Trump’s rule would at some point be reflected in the actual inflation figures,” said Ipek Ozkardeskaya, senior market analyst at London Capital Group, in a note to clients.
Investors will also be watching a speech from Yellen on the goals of monetary policy, due at 3 p.m. Eastern Time. Ahead of that, Minneapolis Fed President Neel Kashkari will make an economy-themed speech at 11 a.m. Eastern.
Read: How long postelection rallies last after Inauguration Day—in one chart
Stocks to watch: Goldman Sachs Group Inc. GS, -3.50%  reported earnings that topped Wall Street’s estimates, while Citigroup Inc. C, -2.10%  reported quarterly revenues that were slightly weaker than expected. Netflix Inc. NFLX, -0.61% will report after the close.
Wal-Mart Stores Inc. WMT, +1.92%  followed 1.4% lower.
Read: What to expect from Netflix earnings
Shares of Cameco Corp. CCJ, -0.15%  fell 8% after the uranium miner said it would cut 10% of its workforce and warned on earnings due to a continued weak market.
Apollo Global Management LLC APO, -1.77% is prepping Chuck E. Cheese for an initial public offering that values the restaurant chain at more than $1 billion, Reuters reported.
Qualcomm Inc. QCOM, -4.02%  shares could be active after the Federal Trade Commission filed a monopoly complaint against the chip maker, whose shares fell 4% in the regular session. See: Qualcomm licensing business, Apple deal attacked in FTC’s antitrust lawsuit
Barron's Bounce: Revlon, Peabody Energy
Stories in Barron's Magazine sent the makeup stock up 7% and the troubled coal miner down 18%. Emily Bary and Jack Hough discuss.
Other markets: European markets SXXP, -0.10%  traded mixed. The FTSE 100 index UKX, +0.25% was modestly higher, after logging its worst loss in six months on Tuesday after Prime Minister Theresa May confirmed the U.K. will exit the EU’s single market.
The British pound GBPUSD, -0.9586%  moved lower against the dollar, trading at $1.2291 from $1.2414 late Tuesday.
See: ‘Textbook short squeeze’ for the pound—analysts assess May’s Brexit plans
Asian stocks ADOW, +0.53%  finished mostly higher, with the Nikkei 225 index NIK, +0.43% rising 0.4%, lifted by a stronger Japanese yen.
Oil prices CLH7, -2.12% lost a grip on earlier gains and fell over 1%, while gold GCG7, +0.03%  was largely unchanged settling at a two-month high Tuesday on Trump and Brexit jitters.