Wall St set for higher open on encouraging China data, earnings


By Amy Caren Daniel

April 17 (Reuters) - Wall Street was set to open higher on Wednesday, as upbeat economic data from China and a jump in Qualcomm shares sparked gains in chipmakers, with sentiment also lifted by largely positive earnings reports.

China's economy grew at a steady 6.4% pace in the first quarter, defying expectations for a further slowdown, adding to optimism that the economy may be starting to stabilize even as Beijing and Washington appear moving closer to a trade deal.

Qualcomm Inc surged 12.2% after the company won a major victory in its legal dispute with Apple Inc that called for the iPhone to once again use Qualcomm modem chips.

Shares of Intel Corp , Advanced Micro Devices and Nvidia Corp were up between 0.7% and 4.41%.

"We've had a tailwind from Chinese economic data, and in general earnings reports have been mixed, but for the most part it was better-than-feared," said Art Hogan, chief market strategist at National Securities in New York.

"We've bounced up to a level where we are pretty fairly valued and we are going to need something significantly new like the U.S.-China trade deal for a higher estimate in 2019."

At 8:49 a.m. ET, Dow e-minis were up 50 points, or 0.19%. S&P 500 e-minis were up 8.5 points, or 0.29% and Nasdaq 100 e-minis were up 40.75 points, or 0.53%.

If current premarket gains hold, the S&P 500 will open 0.9% below the record high hit in late September. Stocks have surged this year on growing hopes of a trade deal with China and better-than-expected earnings reports.

With earnings season in full swing, analysts now expect first-quarter S&P 500 profits to have dropped 1.8% year-on-year, according to Refinitiv data. While a solid improvement over recent estimates, it would still mark the first earnings contraction since 2016.

Of the 42 S&P 500 companies that have posted so far, 81% have beaten consensus, compared with the 65% average beat rate going back to 1994.

Netflix Inc shares reversed course to gain 3.4%. The video streaming service provider gave a weak forecast but its quarterly results beat estimates.

International Business Machines Corp fell 2.7% after reporting a bigger-than-expected drop in quarterly revenue.

PepsiCo Inc rose 2.1% after quarterly results beat Wall Street estimates on higher demand for its snacks and low-sugar sodas.

United Continental Holdings Inc rose 3.2% after reporting a better-than-expected jump in quarterly profit and lifted other airline stocks.

Morgan Stanley shares rose 1.7% after the lender reported quarterly profit above expectations, wrapping up earnings for big U.S. banks.

At 2 p.m. ET, the Federal Reserve issues its so-called Beige Book, a compendium of anecdotes on the health of the economy, drawn from the central bank's sources across the nation.

This article appears in: Stocks , World Markets , Politics
Referenced Symbols: AAPL ,

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