U.S. Futures Rise as Traders Weigh Virus, Earnings: Markets Wrap

 

 

 

These are the main moves in markets:

Stocks

• Futures on the S&P 500 Index climbed 0.5% as of 7:21 a.m. New York time.
• Nasdaq 100 Index futures climbed 0.8%.
• The Stoxx Europe 600 Index climbed 0.3%.
• South Korea’s Kospi index sank 3.1%.
• The MSCI Emerging Market Index declined 0.6%.

Currencies

• The Bloomberg Dollar Spot Index increased 0.1% to 1,200.36.
• The British pound decreased 0.4% to $1.3009.
• The euro declined 0.1% to $1.1004.
• The Japanese yen was little changed at 108.95 per dollar.
• The offshore yuan strengthened 0.1% to 6.9769 per dollar.

Bonds

• The yield on 10-year Treasuries climbed one basis point to 1.61%.
• Germany’s 10-year yield jumped one basis point to -0.38%.
• Britain’s 10-year yield gained one basis point to 0.521%.

Commodities

• Gold weakened 0.5% to $1,574.75 an ounce.
• Iron ore fell 2.5% to $83.06 per metric ton.
• West Texas Intermediate crude increased 0.3% to $53.29 a barrel.

Here are some events to watch out for this week:

• Earnings are due on Tuesday from Lockheed Martin, United Technologies and Apple; Wednesday brings reports from GE, Boeing and Facebook; Samsung Electronics, International Paper, Unilever and Shell report on Thursday, followed by South Korean chip maker SK Hynix, Chevron, Caterpillar and Exxon Mobil all on Friday.
• Fed policy makers on Wednesday are expected to open 2020 the same way they closed 2019 — by holding interest rates steady.
• Goldman Sachs will hold its first-ever Investor Day on Wednesday.
• The BOE meeting is highly anticipated Thursday after a series of dovish comments raised speculation policy makers could lower interest rates.
• The U.S. reports fourth-quarter GDP Thursday.
• The U.K. is scheduled to leave the European Union Friday

U.S. stock-index futures gained and European shares fluctuated before turning higher as investors divided their attention between corporate earnings and international efforts to contain the SARS-like virus from spreading. Treasuries drifted while the dollar held steady.

Contracts on the three main U.S. benchmarks rose, signaling the underlying gauges will recoup some of their slides from yesterday. Apple Inc. rose in the pre-market after a news report that it asked iPhone suppliers to increase output more than 10%. Harley-Davidson Inc. fell after its adjusted earnings missed estimates. The Stoxx Europe 600 Index fluctuated and Chinese equity futures edged lower after Hong Kong Chief Executive Carrie Lam said the city will close some border checkpoints and restrict flights and train services from the mainland.

While China reported the death toll from the virus rose to 106 and confirmed cases nationwide jumped to 4,515, it pledged to provide abundant liquidity for money markets. Shares fell in Japan and South Korea, while trading is set to resume in Hong Kong Wednesday. The latest guidance from China, where the outbreak is still concentrated, is for markets to reopen Monday. The yen held on to five sessions of gains. Crude oil erased a drop to trade sideways.

Investors are keeping an eye out for a slew of earnings due this week including from Apple Inc. on Tuesday while also monitoring the impact of the deadly coronavirus. Even as containment efforts intensify, the likelihood of the virus disrupting global businesses and the world’s second-largest economy appears to be growing.

“Risk appetite is unlikely to improve until we start getting news that the virus is under control,” DBS Group Holdings Ltd. strategists Philip Wee and Eugene Leow wrote in a note. “For now, the lack of positive news flow is likely to keep investors on the defensive.”

The outbreak shattered a calm in markets that hadn’t seen a 1% up-or-down move in the S&P 500 since early October. The latest surge in demand for havens also sent bond yields tumbling, with the global supply of notes with negative rates surpassing $13 trillion, to the highest since November.