By Amy Caren Daniel
April 17 () - 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.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.