Wall Street set to open flat as investors shrug bank results
By Medha Singh
July 17 (Reuters) - Wall Street was set for a muted open on Wednesday as trade worries and concerns about the balance of monetary policy and growth outweighed solid results from Bank of America and a boost to chipmakers from Dutch company ASML.
The second largest U.S. lender BAC.N beat estimates for quarterly profit as a healthy domestic economy boosted demand for loans. Its shares were slightly lower premarket.
Earnings from the big banks JPMorgan Chase & Co JPM.N, Citigroup Inc C.N and Wells Fargo & Co WFC.N this week have raised concerns that lower interest rates will pressure profits at a time when revenue growth is already slow.
Shares of JPM, Citi and Morgan Stanley, which will report on Thursday, were trading flat to marginally lower.
"It's hard for this for this market to push up substantially without some resolution on trade," Rick Meckler, partner, Cherry Lane Investments in New Vernon, New Jersey, said.
At 8:37 a.m. ET, Dow e-minis 1YMcv1 were up 5 points, or 0.02%. S&P 500 e-minis EScv1 were up 1 points, or 0.03% and Nasdaq 100 e-minis NQcv1 were up 5.75 points, or 0.07%.
Since a sharp fall in May, Wall Street's main indexes have been trending higher to hit record highs on hopes of interest rate cuts by the Federal Reserve.
Meckler said markets rose quickly on signs of dovish policy on rates but investors may be inclined to pause with tensions on trade giving them a reason to not to commit any fresh capital.
Adding some nervousness to markets was a threat from U.S. President Donald Trump to tax another $325 billion worth of Chinese goods.
In latest evidence that trade tensions were hurting businesses, railroad CSX Corp CSX.O reported a quarterly profit that missed estimates and lowered its full-year revenue forecast, sending its shares 7.4% lower.
Rivals Union Pacific Corp UNP.N and Kansas City Southern KSU.N, which will post results later this week, fell at least 2% each.
Profit for S&P 500 companies is expected to dip 0.1%, the first quarterly drop in three years, according to Refinitiv IBES data.
Meanwhile, strong quarterly profit from Dutch chip equipment maker ASML ASML.AS helped semiconductor makers including Advanced Micro Devices Inc AMD.O, Micron Technology Inc MU.O, Intel Corp INTC.O and Applied Materials Inc AMAT.O rise between 0.3% and 1.7%.
Qualcomm Inc QCOM.O jumped 4.9% after the U.S. Justice Department asked a federal appeals court to pause the enforcement of a sweeping antitrust ruling against the mobile chip supplier.
In economic news, U.S. homebuilding fell for a second straight month in June and permits dropped to a two-year low, suggesting the housing market continued to struggle despite lower mortgage rates.
FAANG member Netflix Inc NFLX.O will report results after markets close.
(Reporting by Medha Singh in Bengaluru; Editing by Arun Koyyur)