U.S. Futures Advance as Focus Shifts to Earnings: Markets Wrap

• April 16 2018
• Samuel Potter

U.S. equity futures advanced alongside stocks in Europe as investors switched their focus to earnings season following the market turmoil of recent weeks. The euro and pound both reversed gains on soft data.

U.S. equity futures advanced alongside stocks in Europe as investors switched their focus to earnings season following the market turmoil of recent weeks. The euro and pound both reversed gains on soft data.

Contracts for the S&P 500, Nasdaq, and Dow all shrugged off weakness in Asia to point to a higher U.S. open as traders await results from companies including Goldman Sachs Group Inc. The Stoxx Europe 600 Index rebounded from Monday’s drop. The dollar flirted with the lowest level in two months in the wake of President Donald Trump’s latest verbal foray into exchange rates, before U.K. wage growth including bonuses missed estimates and a survey showed German investor confidence tumbling. The pound and euro edged lower. Treasury yields rose and West Texas crude fluctuated.

Corporate earnings should offer some distraction for investors after a torrid period for stocks, but there remain no shortage of other catalysts waiting in the wings to roil markets. Trump’s latest intervention in currencies comes at a time of already elevated geopolitical tension, and ongoing fears of a lurch toward global protectionism. Meanwhile a slew of Federal Reserve officials is also due to speak this week.

Earlier, technology shares paced declines on the MSCI Asia Pacific Index after China’s ZTE Corp. was blocked from buying crucial American technology and its suppliers fell. Data showed China’s economy expanded in line with estimates in the first quarter, but industrial production missed estimates in March even as retail sales came in stronger than expected.

Terminal users can read more in our markets live blog.

Here’s what to watch out for this week:

• Goldman Sachs Group Inc. and Morgan Stanley among companies reporting results.
• John Williams, soon to be president of the New York Fed, speaks on economic outlook in Madrid on Tuesday.
• Trump welcomes Japan Prime Minister Shinzo Abe to Mar-a-Lago on Tuesday. North Korea and trade will probably be discussed.
• Mining investors will get to take the pulse of the global industry this week, with Rio Tinto and BHP Billiton offering quarterly production reports.

Here are the main moves in markets:

Stocks

• The Stoxx Europe 600 Index rose 0.4 percent as of 11:03 a.m. London time, the highest in almost seven weeks.
• Futures on the S&P 500 Index increased 0.4 percent to the highest in almost four weeks.
• The MSCI All-Country World Index climbed less than 0.05 percent to the highest in almost four weeks.
• The U.K.’s FTSE 100 Index rose 0.3 percent, the biggest advance in a week.
• Germany’s DAX Index jumped 0.9 percent to the highest in seven weeks.
• The MSCI Emerging Market Index sank 0.4 percent to the lowest in almost two weeks.
• The MSCI Asia Pacific Index declined 0.3 percent to the lowest in more than a week.

Currencies

• The Bloomberg Dollar Spot Index climbed less than 0.05 percent.
• The euro dipped 0.1 percent to $1.2371.
• The British pound fell 0.1 percent to $1.4319, the first retreat in more than a week.
• The Japanese yen gained 0.1 percent to 107.04 per dollar.

Bonds

• The yield on 10-year Treasuries rose one basis point to 2.84 percent, the highest in more than three weeks.
• Germany’s 10-year yield climbed less than one basis point to 0.53 percent, the highest in almost four weeks.
• Britain’s 10-year yield increased less than one basis point to 1.463 percent, the highest in almost four weeks.

Commodities

• West Texas Intermediate crude decreased 0.1 percent to $66.18 a barrel, the lowest in a week.
• Copper declined 1.2 percent to $3.06 a pound, the lowest in almost two weeks.
• Gold dipped 0.3 percent to $1,342.46 an ounce.

— With assistance by Sophie Caronello, Adam Haigh, and Winnie Zhu