U.S. Stocks are set to open higher Wednesday, boosting the Dow Jones Industrial Average past a one-month high, as investors weigh the impact of a strong corporate earnings season but continue to remain concerned over the fate of global economic growth and protectionist trade policies from the White House.
Equity futures prices suggest modest gains for the main U.S. indices later today, with contracts tied to the Dow Jones Industrial Average rising 90 points, indicating a 48 point gain for the benchmark after closing 218 points to the upside last night. The broader S&P 500, which gained 1.05% yesterday, is slated to edge 9.25 points higher at the opening bell.
International Business Machines Corp. (IBM) shares are on pace for their biggest single-day decline in a year Wednesday, a move that will clip around 50 points from the Dow, after the former tech sector icon reported a weaker-than-expected profit margin in an otherwise solid set of first quarter earnings.
IBM shares were marked 5.28% lower in pre-market trading in New York, indicating an opening bell price of $152.43, a move that would be the stock's biggest one-day slide since last April and take the stock into negative territory for the year.
Other stocks moving in pre-market trading include Morgan Stanley (MS) , which popped 1.4% after a stronger-than-expected set of first quarter earnings, and ebay Inc, (EBAY) , which surged 4.16% after a double upgrade to 'overweight' from Morgan Stanley analysts Brian Nowak.
In Europe, the Stoxx 600 index edged 0.103% higher by mid-day in Frankfurt, with similar percentage gains for benchmarks around the region as investors approached the session with caution after President Donald Trump Tweeted last night that he doesn't intend to bring the U.S. back into the Trans-Pacific Partnership trade deal, a comment that suggests his two-day summit with Japan's Prime Minister Shinzo Abe isn't bringing the two sides closer to an agreement on narrowing the latter's $623 billion U.S. trade surplus.
While Japan and South Korea would like us to go back into TPP, I don't like the deal for the United States. Too many contingencies and no way to get out if it doesn't work. Bilateral deals are far more efficient, profitable and better for OUR workers. Look how bad WTO is to U.S.
- Donald J. Trump (@realDonaldTrump)April 18, 2018The FTSE 100, however, gained 0.7% after Britain's inflation rate slowed to the lowest level in a year last month, according to official figures published Wednesday, casting fresh doubt on imminent rate hikes from the Bank of England and sending the pound sharply lower.
Consumer price inflation in the U.K., Europe's second-largest economy, slowed to 2.5% in March, the Office for National Statistics said, missing the consensus estimate of 2.7% and sliding to the slowest rate since March 2017. The pound, which traded at the highest levels -- 1.4370 -- against the U.S. dollar since the June 2016 Brexit vote yesterday, slipped more than 0.66% to 1.4195 in the immediate minutes following the ONS release.
The broader market caution reflects the current investor mood, at least according to this month's Bank of America Merrill Lynch fund managers' survey, which indicated that global portfolio bosses have trimmed their equity holdings to the lowest levels in 18 months, and added to cash balances, as they fret over the slowing pace of economic growth and Trump's myriad salvos against the country's largest trading partners.
In fact, only 5% of the 216 fund managers polled -- who control a collective $646 billion in assets -- think the global economy will improve over the next 12 months.
Overnight in Asia, however, stocks did manage to eek out modest gains as traders preferred to ride the wake of last night's solid close for Wall Street and focus on the strength of the U.S. corporate earnings season, where companies are set to grow their bottom lines by more than 20% this quarter when compared to the same period last year.
The region-wide MSCI Asia ex-Japan index was marked 0.39% higher into the close of trading while Japan's Nikkei 225 posted a solid 1.42% advance to end the session at 21,158.2 points.
The U.S. dollar index, which benchmarks the greenback against a basket of six global currencies, edged higher to trade at 89.55 in early European dealing as 10-year U.S. Treasury notes bumped one basis point higher to 2.84%.
Britain's inflation rate slowed to the lowest level in a year last month, according to official figures published Wednesday, casting fresh doubt on imminent rate hikes from the Bank of England and sending the pound sharply lower.
Consumer price inflation in the U.K., Europe's second-largest economy, slowed to 2.5% in March, the Office for National Statistics said, missing the consensus estimate of 2.7% and sliding to the slowest rate since March 2017. The pound, which traded at the highest levels -- 1.4370 -- against the U.S. dollar since the June 2016 Brexit vote yesterday, slipped more than 0.66% to 1.4195 in the immediate minutes following the ONS release.
Global oil markets resumed their recent rally again Wednesday, with prices fuelled by data from the American Petroleum Institute yesterday which showed a surprise 1 million barrel decline in U.S. crude stocks. The Energy Information Administration will publish official data at 10:30 eastern time.
Brent futures contracts for June delivery, the global benchmark, were seen 0.65% higher from their Tuesday close in New York and changing hands at $72.01 per barrel while WTI contracts for the same month rose 0.63% to $67.00