Wall Street Seeking To Put Fed Worries Behind

By RTT News, 
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(RTTNews.com) - Early indications suggest that Wall Street stocks may slowly recover from the Fed backlash. The major U.S. index futures are currently pointing to a modestly higher open on Thursday. That said, several catalysts, including earnings from some blue chips and economic data on fourth quarter GDP, jobless claims and pending home sales, could play out in the interim, as the markets attempt to rebound. Among the global markets, Asian stocks closed notably lower, while the European markets are extending their slide amid the release of some domestic earnings.

At 6:15 am ET, the Dow futures are rising 16 points, the S&P 500 futures are adding 3.25 points and the Nasdaq 100 futures are moving up 9 points.

U.S. stocks reversed course on Thursday, retreating sharply amid the FOMC announcement, as a lack of clarity on the pace of stimulus trimming exerted downward pressure on stocks.

On the economic front, the Labor Department is scheduled to release its jobless claims report for the week ended January 25th at 8:30 am ET. Economists estimate claims to have risen to 327,000 from 326,000 in the previous week. Around the same time, the Commerce Department is scheduled to release its advance fourth quarter GDP estimate. The consensus estimates call for a deceleration in the rate of growth to 3 percent from 4.1 percent in the third quarter.

The National Association of Realtors will release its pending home sales index for December at 10 am ET. Economists estimate pending home sales to have declined 0.5 percent month-over-month in December. The Treasury is set to announce the results of the auction of 5-year and 7-year notes at 1 11:30 am ET and 1 pm ET, respectively.

In corporate news, Facebook (FB) reported better than expected results for its fourth quarter, helped by strong mobile ad revenue growth. Chipmaker Qaulcomm (QCOM) reported first quarter earnings that were ahead of estimates, while its revenues missed expectations. The company raised its full year earnings guidance, which was in line with estimates. However, the company's second quarter guidance was weak.

Symantec (SYMC) reported third quarter earnings and revenues that came ahead of estimates. The company issued strong earnings and revenue guidance for 2014.

Las Vegas Sands (LVS) reported fourth quarter results that beat estimates, while its revenues were below expectations. Flextronics' (FLEX) third quarter results also exceeded estimates. Lam Research's (LRCX) second quarter results also beat estimates and the company's guidance for the third quarter was upbeat.

Google (GOOG) announced a deal to sell its Motorola Mobility smartphone business to Lenovo for $2.91 billion. Meanwhile, Google will maintain ownership of the vast majority of Motorola Mobility patent portfolio, although on the base of its ongoing relationship with Google, Lenovo will receive license to this rich portfolio.

Amazon.com ( AMZN ), Broadcom ( BRCM ), Celestica ( CLS ), Chipotle Mexican Grill ( CMG ), Computer Sciences (CSC), Emulex (ELX), Google (GOOG), JDS Uniphase (JDSU), Manitowoc (MTW), Netsuite (N), PMC-Sierra (PMCS), Reinsurance Group of America (RGA), Tellabs (TLAB), Tuesday Morning (TUES), Unisys (UIS) and Wynn Resorts (WYNN) are among the companies due to release their quarterly results after the close of trading.

The Asian markets retreated, unimpressed by the Fed decision and worried over a slowdown in China. The Taiwanese and South Korean markets were closed for a public holiday.

Japan's Nikkei 225 average plunged amid the strengthening of the yen, as traders sought the currency due to its safe haven appeal amid the risk aversion in play in the markets. The index ended down 376.85 points or 2.45 percent at 15,007. A majority of stocks declined in the session, with financial and real estate stocks being the worst hit.

Australia's All Ordinaries also languished below the unchanged line throughout the session before closing down 41.20 points or 0.79 percent at 5,199. The market witnessed broad based weakness, led by financial, consumer staple and energy stocks, although defensive telecom stocks bucked the trend with modest gains.

Hong Kong's Hang Seng Index ended at 22,035, down 106.19 points or 0.48 percent, and China's Shanghai Composite Index closed 16.83 points or 0.82 percent lower at 2,033.

On the economic front, revised estimates released by HSBC and Markit Economics showed that the manufacturing index based on their survey came in at 49.5 in January, down sharply from 50.5 in December and the flash estimate of 49.6.

After a shaky start, European stocks have moved decisively lower, as traders digest domestic earnings and economic data and the cues from Asia.

In corporate news, B/E Aerospace ( BEAV ) reported higher earnings and revenues for its fourth quarter. For 2014, the company expects adjusted earnings of $4.25 per share on revenues of $4 billion.

Ericsson's (ERIC) reported fourth quarter earnings that missed estimates by most analysts and flat revenues. Infineon (IFX) reaffirmed its second quarter revenue growth forecast after reporting first quarter adjusted operating earnings that beat estimates. Swiss drug giant Roche's 2013 core earnings trailed estimate, while it expects revenues to rise by a low to mid-single-digit percentage. Shell reported fourth quarter adjusted earnings in line with its negative pre-announcement, with the quarterly profits being the lowest in 5 years. The company said it would seek disposals and make efforts to improve cash flows.

On the economic front, data released by the Federal Statistical Office revealed that the seasonally adjusted unemployment rate came in at 5.1 percent in December, unchanged from November. The number of employed people edged up by 0.1 percent month-over-month to 40.53 million.

Mortgage approvals in the U.K. rose to their highest level in almost six years in December, Bank of England data showed. Separately, a key European Commission indicator showed that optimism in the euro zone about its economic prospects continued to improve in January.

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This article appears in: News Headlines

Referenced Stocks: AMZN , BEAV , BRCM , CLS , CMG

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