Thursday April 25th

25-04-2019

Dow set to fall more than 150 points at the open after ugly 3M earnings miss

The Dow Jones Industrial Average was headed for a big drop on Thursday after a disappointing quarterly report from 3M. Dow futures traded down 121 points, indicating a drop of 171 points at the open. Shares of 3M dropped more than 9% after the company reported earnings that were much lower than analysts had expected. The company also slashed its full-year outlook and announced plans to cut 2,000 jobs worldwide. Futures on the S&P 500 pointed to a small gain for the broad index, however, while Nasdaq 100 futures indicated solid gains after strong Facebook results. Shares of the social media giant jumped 8.6% in the premarket. “We believe investors will continue to gain comfort with the incremental financial risk created by content and privacy concerns,” Guggenheim Partners analyst Michael Morris wrote in a note. “The company is proactively and definitively addressing these issues while expanding core monetization and new initiatives.” The analyst also raised his price target on Facebook to $220 per share from $200. More than 170 S&P 500 companies have reported quarterly results so far, according to FactSet. Of those companies, 78% have posted better-than-expected earnings. Wall Street ended Wednesday’s session lower on the back of mixed corporate results. Earnings will remain the biggest market focus Thursday with Comcast and UPS due to report before the bell. Amazon, Ford, Inter, Starbucks and T-Mobile are set to update investors after the bell. In terms of data, orders for long-lasting durable goods posted the biggest increase in March since last summer, potentially signaling a rebound in the slower-growing industrial side of the economy. Durable-goods orders leaped 2.7% last month, led by stronger demand for autos, planes and networking equipment , the government said Thursday. Economists surveyed by MarketWatch had forecast a 0.5% increase. The number of people who applied for unemployment benefits in late April surged to a two-and-a-half month high of 230,000, but the spike was likely exaggerated by spring break and the Easter holiday. New claims are still near historic lows. Jobless claims rose by 37,000 from a revised 193,000 in the prior week, which marked the lowest level since 1969. Housing vacancies are due at 10:00 a.m. ET. Meanwhile, Russian President Vladimir Putin received the leader of North Korea Thursday. One expert told CNBC the meeting aims to show Kim Jong Un that he has more options aside from the United States. Stocks in China tumbled on Thursday amid worries that Beijing could pull back on stimulus measures following recent better-than-expected economic data. The Shanghai composite fell 2.43% to close at 3,123.83 and the Shenzhen component dropped about 3.21% to finish at around 9,907.62. The Shenzhen composite also plunged 3.411% to close at 1,688.25. Hong Kong’s Hang Seng index also slipped around 0.8%, as of its final hour of trading. The Nikkei 225 in Japan rose 0.48% to close at 22,307.58. The Topix index also added 0.51% to finish at 1,620.28. Over in South Korea, the Kospi declined 0.48% to close at 2,190.50. Brent oil rose above $75 per barrel on Thursday for the first time this year as quality concerns forced the suspension of some Russian crude exports to Europe while the United States prepared to tighten sanctions on Iran. Brent crude futures were at $75.14 by 8:30 a.m. ET (1230 GMT), up 57 cents. They earlier hit a session high of $75.60, their strongest since Oct. 31. U.S. West Texas Intermediate crude was at $66.07 per barrel, up 18 cents and near this week’s 2019 high at $66.60. Gold inched higher on Thursday as weak economic data rekindled global growth fears, while bullion’s recovery from four-month lows and an improved technical picture prompted some investors to cover their short positions. Spot gold was 0.2 percent higher at $1,277.56 per ounce. U.S. gold futures were steady at $1,279.50 an ounce.