Wednesday May 10th

10-05-2017

Earnings, data deluge and US politics set the stage on Wall Street

U.S. stock index futures pointed to a lower open on Wednesday, as investors prepared to wade through new data and earnings, while keeping a close eye on the potential fallout from President Trump's decision to fire the director of the FBI. On Tuesday, Trump terminated James Comey's role at the FBI, saying in a letter that it was "essential that we find new leadership for the FBI that restores public trust and confidence in its vital law enforcement mission." The U.S. dollar came under pressure shortly after the news, meanwhile, markets in Europe saw slight weakness during morning trade, and Asia Pacific markets ended on a mixed note. Stepping aside from politics, a whole host of U.S. companies are set to report earnings on Wednesday, with Whole Foods and 21st Century Fox expected to be of key focus. On Wednesday, Snap's first earnings report since its IPO will be under close watch, with investors looking to see if Snap has been able to re-accelerate its user base following a drop last quarter, and whether it can ramp up its ad growth. In data news, mortgage applications rose 2.4 percent on a seasonally adjusted basis last week. Import prices rose 0.5 percent, more than expected. In the central bank sphere, more U.S. Federal Reserve members are expected to deliver speeches on Wednesday. Equities in Asia closed mixed on Wednesday as investors digest the dramatic dismissal of FBI Director James Comey in the U.S. and follow the inauguration of liberal candidate Moon Jae-in after his win in the South Korean presidential election. Japan's benchmark Nikkei 225 index closed 0.29 percent or 57.09 points higher at 19,900.09 while the Kospi fell 0.99 percent to close at 2,270.12 following Moon's election victory. Markets in greater China were mixed, with Hong Kong's Hang Seng Index up 0.6 percent. The Shanghai Composite was closed 0.93 percent or 28.7761 points down at 3,051.7508, while the Shenzhen Composite was dropped 1.358 percent to close at 1,822.5571. Markets in Singapore, Thailand and Malaysia were closed for the Vesak Day public holiday. In commodities news, oil prices posted solid gains Wednesday, with U.S. WTI trading 1 percent higher at $46.42 around 8:37 a.m. ET, while Brent rose to $49.28 per barrel. Gold edged off the previous day's eight-week low on Wednesday as U.S. President Trump's abrupt firing of FBI chief James Comey hit share markets, but expectations of further U.S. interest rate hikes capped gains by the metal. Spot gold was up 0.3 percent at $1,224.58 an ounce, while U.S. gold futures for June delivery were up 0.7 percent to $1,224.60.  On Tuesday, the Dow Jones industrial average and S&P 500 ended lower after the North Korean ambassador to the UK told Sky News that the nation would proceed with its sixth nuclear test.