Active broad-market exchange-traded funds ahead of Friday's regular session:
SPDR S&P 500 ( SPY ): +0.4%
VanEck Vectors Gold Miners ETF ( GDX ): +0.5%
iShares MSCI Emerging Index Fund ( EEM ): +0.1%
iPath S&P 500 VIX Short Term Futures ETN ( VXX ): -0.8%
ProShares Trust Ultra VIX Short Term Futures ETF ( UVXY ): -2%
Broad Market Indicators
Broad-market exchange-traded funds, including SPY, IWM and IVV were higher. Actively traded PowerShares QQQ (QQQ) was up 0.8%.
US stock futures were higher but trimmed earlier gains after the Q4 gross domestic product missed analysts' projections and as investors digested US President Donald Trump's speech to the World Economic Forum in Davos.
In a speech to global leaders and corporate executives, Trump said that the US is "open for business" but wanted the trade to have terms favorable to American businesses.
On the economic front, Q4 GDP growth was 2.6%, missing expectations for 2.9% due mainly to lower inventory production and larger trade deficit. Despite falling short of forecasts, the number still indicates a healthy economy, with readings of 3% over the past two quarters.
The Commerce Department reported that durable goods orders for December accelerated by 2.9%, versus the consensus for 0.6%, compared to 1.3% in the prior month. Excluding contracts for transportation equipment, orders rose a smaller 0.6%.
Meanwhile. the US International trade in goods showed a deficit of $71.6 billion. The consensus was for a deficit of $69.0 billion, narrower that $69.7 billion in November.
Finally. the advance report for wholesale inventories for December showed an increase of 0.2%. Analysts were looking for advance wholesale inventories of 0.3%, down from 0.7% in the prior month.
Power Play: Consumer
Consumer Staples Select Sector SPDR (XLP), Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones US Consumer Goods (IYK) were flat.
Consumer Discretionary Select Sector SPDR (XLY) and retail funds SPDR S&P Retail (XRT), PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were quiet in pre-market trade.
Starbucks (SBUX) fell 5% after it reported alte Thursday Q1 revenue was $6.07 billion, up 6% from prior year levels but slightly shy of the analyst consensus of $6.18 billion on Capital IQ. Global and US comp store sales were up 2%. Non-GAAP earnings were $0.65 per share, including a $0.07 per share benefit from US tax law changes, up from $0.52 per share last year. The Street view called for earnings of $0.57 per share, excluding items. GAAP earnings were $1.57 per share, up from $0.51 per share a year ago. Looking forward for FY 2018, the company continues to expect 3% to 5% comparable store sales growth globally and expects to be near the low end of the range for the year. Revenue growth is seen in the high single digits. Non-GAAP earnings are targeted in the range of $2.48 to $2.53 per share, vs. expectations of $2.35 per share.
Winners and Losers
The Select Financial Sector SPDRs (XLF) was up 0.3%. Direxion Daily Financial Bull 3X shares (FAS) was up 0.8% and its bearish counterpart FAZ was down 0.6%.
E*TRADE Financial (ETFC) fell more than 2% after the company reported Q4 earnings of $0.48 per share, which included $0.16 per share related to tax reform and other items, compared with the prior-year period's $0.46 per share. Analysts polled by Capital IQ were expecting GAAP and non-GAAP EPS of $0.61. Revenue was $637 million, up from $509 million in the same quarter last year. The Street view was for revenue of $629 million.
The company also said it has entered into a definitive agreement to acquire more than one million retail brokerage accounts with $18 billion in customer assets from Capital One Financial for a purchase price of $170 million. As of Dec. 31, 2017 these accounts carried $1.9 billion in customer cash, as well as $0.2 billion in customer margin balances. E*TRADE expects the transaction to be relatively neutral to earnings in 2018 and $0.06 accretive in 2019 when full run-rate synergies are expected. The company intends to fund the transaction with existing corporate cash. The transaction is expected to close during Q3 of 2018, subject to customary closing conditions and regulatory approvals.
Technology Select Sector SPDR ETF (XLK) and other tech funds iShares Dow Jones US Technology ETF (IYW), iShares S&P North American Technology ETF (IGM) and iShares S&P North American Technology-Software Index (IGV) were flat.
Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were inactive.
Intel (INTC) rose nearly 6% after it reported late Thursday a non-GAAP diluted EPS of $1.08 in Q4, easily beating analysts' estimates of $0.87 in a Capital IQ poll, and up from $0.79 a year earlier. Revenue rose 4% to $17.1 billion from $16.4 billion a year ago, exceeding the $16.34 billion estimate. For Q1, Intel said it expects non-GAAP EPS of $0.70, plus or minus $0.05, on revenue of $15 billion, plus or minus $500 million, against market expectations of $0.72 for EPS on revenue of $15.03 billion. For full year 2018, it expects non-GAAP EPS of $3.55, plus or minus 5%, on revenue of $65 billion, plus or minus $1 billion, That compared with market estimates of $3.28 for EPS on revenue of $63.88 billion.
The chip maker also said it would raise its dividend to $1.20 per-share on an annual basis, a 10% increase, as it declared a quarterly dividend of $0.30 per-share, payable on March 1 to shareholders of record on Feb. 7.
Select Sector SPDR-Industrial (XLI) rose 0.3% while other industrial funds Vanguard Industrials (VIS), iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ) were inactive.
Honeywell International (HON) rose some 1% after it posted Q4 adjusted earnings per share of $1.85 compared with $1.74 in the same quarter a year earlier. The adjusted EPS figure assumes dilution and excludes pension mark-to-market expense, debt refinancing expense, separation costs, impacts from tax reform, and 2016 divestitures, the company said in a statement on Friday. Analysts in a Capital IQ poll expected adjusted EPS of $1.84 on average. It wasn't immediately clear if the estimate is comparable to the actual outcome. Net sales in the quarter totaled $10.84 billion compared with $9.99 billion a year eartlier, the company said. Analysts had predicted $10.80 billion of revenue for Q4.
The company also said it raised its 2018 earnings forecast to reflect an expected lower tax rate due to the US Tax Cuts and Jobs Act of 2017. Full-year earnings per share are now expected to be between $7.75 and $8.00, compared with an earlier estimate of between $7.55 and $7.80. The expected earnings growth rate is now 9% to 13% compared with 6% to 10% earlier. Wall Street analysts are expecting 2018 EPS of $7.84.
Dow Jones US Energy Fund (IYE) was inactive and Energy Select Sector SPDR (XLE) was up 0.4%.
Gastar Exploration (GST) rose more than 18% after it said late Thursday it has agreed to sell its interest in the West Edmund Hunton Lime unit primarily in Oklahoma and Logan counties, Oklahoma, for $107.5 million. "This divestiture of our WEHLU assets should provide Gastar with sufficient liquidity to fund our core STACK acreage development plan through 2018," CEO Russell Porter said. "Due to our large, contiguous acreage position with as many as six potentially productive formations and multiple benches within certain prospective formations, we have a large inventory of undrilled horizontal locations to exploit to create value going forward."
Crude was up 1.4%. United States Oil Fund (USO) was up 0.4%. Natural gas was up 1.3% while United States Natural Gas Fund (UNG) was up 1.5%.
Gold was down 1%. SPDR Gold Trust (GLD) was up 0.1%. Silver was down 1.4%, while iShares Silver Trust (SLV) was up 0.4%.
Health Care SPDR (XLV) and other health care funds Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were quiet. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.4% in pre-market trade.
AbbVie (ABBV) rose more than 5% after it reported Q4 adjusted net profit of $1.48 per share, up from $1.20 per share in the prior year period and came in higher than the $1.43 per share Street estimate provided by Capital IQ. Net revenue was $7.74 billion, up from $6.80 billion reported for the same period last year and higher than the $7.53 billion Street estimate. For 2018, the company now expects adjusted earnings to range from $7.33 to $7.43 per share, up from previously $6.37 to $6.57 per share. The Street consensus calls for adjusted EPS of $6.66.
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