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Oct 15, 2018

Before The Bell Update: Dow futures turn positive, paring earlier losses as stocks try to recover from last week's steep drop I CNBC


Fred Imbert, Sam Meredith


U.S. stock index futures pared steep losses on Monday mornings as Wall Street tried to recover from a 4 percent drop in the major indexes last week.
Dow Jones Industrial Average futures turned positive at around 7:50 a.m. ET, while futures on the S&P 500 and Nasdaq 100 were also off their lows.
The Dow finished almost 300 points higher on Friday but stocks still registered steep losses for the week as investors fretted over rising interest rates. The Dow and S&P 500 finished the previous trading week down more than 4 percent, while the Nasdaq posted a 3.7 percent weekly loss.
Investors blamed rapidly rising interest rates, concerns about technology stock valuations and a possible slowdown in the global economy for the selling. The 10-year Treasury yield hit a seven-year high of 3.26 percent last week.
In Monday's premarket trading, Amazon shares rose 0.7 percent while Goldman Sachs rose marginally. Netflix's stock, however, slipped 0.2 percent after Raymond James cut its price target on the video-streaming giant.
Earnings season kicks into high gear this week with Netflix, Morgan Stanley, Johnson & Johnson, Procter & Gamble and Honeywell reporting. Investors are hoping some strong results will stave off the selling, but company outlooks could reinforce current concerns about rising rates and a slowing global economy due to tariffs.
Bank of America reported better-than-expected earnings and revenue on Monday, sending its stock up by 1.2 percent. Charles Schwab was also expected to report earnings later in the morning.
Retail sales figures for September are scheduled to be published at around 8:30 a.m. ET on Monday. Later in the session, Empire State Manufacturing Index data for October and business inventories data for August are both set to be released at around 10 a.m.
—CNBC's John Melloy contributed to this report.

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