U.S. stock futures fall in a week packed with earnings and a Fed update

Caterpillar poised to headline week’s earnings onslaught; oil prices slump as perceived riskier assets pull back

U.S. stock futures fell Monday, as investors turned cautious in a busy week of earnings, economic reports — headlined by a midweek Federal Reserve policy update — and a new round of U.S-China trade talks.

How are benchmark indexes trading?

Dow Jones Industrial Average futures YMH9, -1.24%  slid 191 points, or 0.7%, to 24,504, while S&P 500 futures ESH9, -1.09%  fell 16.25 points, or 0.6%, to 2,647.50. Nasdaq-100 futures NQH9, -1.71%  dropped 45.50 points, or 0.7%, to 6,746.50.

On Friday, the Dow DJIA, -1.37% climbed 183.96 points, or 0.8%, to end at 24,737.20. The blue-chip index edged up 0.1% for the week, extending gains for a fifth week in a row. The S&P 500 SPX, -1.11% rose 22.43 points, or 0.9%, to 2,664.76, down 0.2% on the week. The Nasdaq Composite COMP, -1.48%  climbed 91.40 points, or 1.3%, to 7,164.86, for a weekly rise of 0.1%.

Read: Stock-market bulls look to put faith in Fed as earnings continue to roll in

What’s driving the market?

Friday’s equity gains came after a surprise deal between U.S. President Donald Trump and congressional leaders to reopen the government until Feb. 15, for now ending a 35-day partial shutdown. Lawmakers will debate funding for an extension of the southern border wall.

But fears of another shutdown weren’t far as Trump said he placed a 50-50 chance of a deal over border-wall funding being reached by a newly created board of 17 before the next government-funding deadline, in an interview with The Wall Street Journal.

Meanwhile, some wariness ahead of a Fed meeting and a huge week for earnings were keeping investors cautious. The central bank will convene its two-day meeting on Tuesday, with no change in key interests expected. Attention is instead likely to focus on a news conference afterward with Fed Chairman Jerome Powell for any clues on future policy.

Read: Why upbeat investors are counting on the ‘Powell put,’ the ‘Trump put’ and the ‘Xi put’

Earnings will swing into focus in a big way this week, starting with Caterpillar CAT, -8.99% , whose shares are down 4.3% in premarket trade, following an earnings report which showed the company missing fourth-quarter earnings forecasts.

After the close, Whirlpool Corp. WHR, -0.62%  is set to report. Investors will also hear from big names such as Facebook Inc. FB, -1.26% Amazon.com Inc. AMZN, -2.50%  and Apple Inc. AAPL, -1.95% Optimism over earnings also supported stocks last week.

Caterpillar earnings: Analysts expect good news on mining and an update on China

Read: Don’t worry, Mr. President, the media is about to pay a lot more attention to earnings

Trade will also come into focus, with talks aimed at resolving the impasse over Chinese technology ambitions and other issues expected to restart in Washington later in the week, headed up by U.S. Trade Representative Robert Lighthizer and Chinese Vice Premier Liu He.

What data area ahead?

A reading of business activity is due, with the Federal Reserve of Chicago’s national activity index due at 8:30 a.m. Eastern Time, while a Dallas Fed manufacturing survey is due at 10 a.m.

What are the analysts and traders saying?

Us stocks are “starting this week under some pressure, as Trump throws cold water on the chances of a shutdown deal, and after Chinese industrial production comes in light,” wrote Dave Lutz, head of ETFs at JonesTrading, in a Monday-morning research note. “We have many unknowns ahead this week, with US China Trade Talks, The FOMC decision, US Jobs Report, 124 S&P names [reporting], a heavy tech reporting week with AAPL, AMZN and MSFT highlighting, and Angst over tomorrow’s Brexit vote.”

Caterpillar earnings: Analysts expect good news on mining and an update on China

Read: Don’t be scared of a bear market, here’s what to do

How are other markets trading?

Meanwhile, stocks in Asia finished mixed, with the Nikkei 225 index NIK, -0.60%  closing down 0.6% and Hong Kong’s Hang Seng Index HSI, +0.03% ending flat. European stocks were lower, with the Stoxx Europe SXXP, -0.85% slipping 0.2%.

Crude-oil prices CLH9, -3.00%  were under pressure, while gold futures GCG9, -0.04% inched higher and the ICE U.S. Dollar Index DXY, +0.12% a measure of the U.S. currency against a basket of six major rivals, was flat. The British pound GBPUSD, -0.3636%  fell 0.2% to $1.3168 as ahead of a series of Brexit-related votes in the U.K. parliament that could delay or even cancel the country’s exit from the European Union.

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