Tuesday October 13th


Futures try to hold higher admid data

U.S. stock index futures pointed to a slightly higher open on Wednesday amid earnings from big name financial companies and some top-tier data releases that will be closely watched by investors for hints on the strength of the U.S. economy. Following on from JPMorgan's disappointing results late Tuesday, Bank of America beat analysts' expectations. Meanwhile ,BlackRock said its third-quarter profits fell 8 percent. Wells Fargo also reported earnings that beat expectations. Earnings could be a particular challenge for stocks this quarter, with analysts expecting a 4.8 percent decline in S&P 500 profits, according to Thomson Reuters. So far, there's been a trickle of reports, but the season gains momentum Wednesday with results from the major financials and others, like Delta Airlines, Kinder Morgan and Netflix reporting after the close. JPMorgan, which is seen as a bellwether for the rest of the financial sector, earned $1.32 per share, excluding $2.2 billion in tax benefits and other items. Volatile financial markets hit revenues, which fell 6.4 percent to $23.5 billion. On the data front U.S. retail sales barely rose in September as cheaper gasoline weighed on service station receipts, while producer prices posted their biggest decline in 8 months. August business inventories data are also due at 10:00 a.m. and the U.S. Federal Reserve's latest Beige Book at 2:00 p.m. Chinese inflation data, released overnight also weighed on sentiment, cooling more than expected last month, adding to concerns about the health of the world's second-biggest economy. China's consumer price index (CPI) rose 1.6 percent in September from a year earlier, against forecasts of a 1.8 percent rise from a Reuters poll and following August's 2 percent gain. The weak data weighed on Asian and European stocks, with major indices in Europe falling in the region of 1 percent in mid-morning London trade. Nikkei skids 1.9%. Japan's Nikkei 225 index was one of the biggest laggards in the region on Wednesday, but managed to come off the day's lows in the final minutes of trading. Oil traded below $50 a barrel on Wednesday, after falling for a two consecutive sessions, on concern a supply glut will persist and demand will slow down as economic growth moderates in No. 2 consumer China. Chinese growth for the third quarter is expected to fall below 7 percent for the first time since the global financial crisis. The International Energy Agency (IEA) said on Tuesday the oil market would remain oversupplied in 2016. Brent crude was up 18 cents at $49.42 a barrel by 8:38 a.m. EDT (1036 GMT). U.S. crude was up 13 cents at $46.79. "Prices should remain low," said Daniel Ang, an investment analyst at Phillip Futures. "We are still in oversupply." Gold steadied near 3-1/2 month highs on Wednesday as concerns over deflationary pressures in China fueled expectations the Federal Reserve will hold off raising U.S. interest rates, pressuring stocks and the dollar. Spot gold peaked at $1,176.20 an ounce, its highest since June 30, and was up 0.4 percent at $1,173.36 an ounce. U.S. gold futures for December delivery were up $9.10 an ounce at $1,174.50.