Wednesday December 21st


Stock futures rise, helped by Nike and FedEx earnings

U.S. stock index futures rose on Wednesday after earnings reports from two major bellwethers raised hopes that corporate earnings may be better than feared even with a possible recession on the horizon. Futures tied to the Dow Jones Industrial Average added 260 points, or 0.8%. S&P 500 futures rose 0.6% and Nasdaq 100 futures climbed 0.4%. Nike shares added 12% after the apparel maker beat Wall Street’s expectations for quarterly earnings and revenue. FedEx gained 4.7% even as it fell short of revenue expectations. The package delivery giant beat consensus earnings per share estimates on per-share. With the end of 2022 in close sight, all three major averages are on pace to post their worst yearly performance since 2008 and break a 3-year win streak. As of Tuesday’s close, the Dow was down 9.6%. For the month, it’s toppled about 5%. The S&P is down 19.82% for the year and more than 6% for December, while the Nasdaq’s plummeted 32.58% in 2022 and about 8% this month. Wednesday’s moves followed a day of slight gains for stocks. The major indexes snapped a four-day losing streak, putting a little wind back into hopes for an end-of-year rally. The modest gains came even after the Bank of Japan moved to widen its cap on the 10-year Japanese government bond yield, leading to a spike in the 10-year U.S. Treasury yield higher that initially rattled traders. There are a few more big names left to report earnings before the Christmas holiday, with Micron reporting after the bell. Markets in the Asia-Pacific traded mixed after Wall Street ended its four-day losing streak as global bonds rose after the Bank of Japan adjusted its yield curve control tolerance. Japan continued its second day of losses, as the Nikkei 225 fell 0.68% to 26.387.72 and the Topix lost 0.64% to 1,893.32. The Japanese yen stood at 131.97 against the U.S. dollar. The Kospi in South Korea erased earlier gains and traded 0.19% lower to 2,328.95. Hong Kong’s Hang Seng index gained 0.22% as Chief Executive John Lee is scheduled to travel to Beijing as part of his annual visit until Saturday to brief state leaders on the city’s economic, social and political situation. In mainland China, the Shenzhen Component fell 0.34% to 10,912.08 and the Shanghai Composite fell 0.17% to 3,068.4. Oil prices rose on Wednesday after data suggested a larger than expected draw in U.S. crude stockpiles, but gains were capped by growing concerns over demand in China and a snow storm that is expected to hit U.S. travel. Brent crude futures were up $1.18, or 1.5%, at $81.17 a barrel. U.S. West Texas Intermediate (WTI) crude futures gained $1.02, or 1.3%, to $77.21. Both contracts had risen by more than $1 earlier in the session. U.S. crude inventories fell by about 3.1 million barrels in the week to Dec. 16, said market sources, citing data from the American Petroleum Institute. Nine analysts polled by Reuters had forecast a drop of 1.7 million barrels. Official government data is due at 1530 GMT. Gold prices eased in a tight range on Wednesday as the U.S. dollar firmed, although bullion was not far from a one-week high scaled in the previous session as traders looked ahead to impending economic data later this week. Spot gold fell 0.3% to $1,812.18 per ounce, after rising more than 1% on Tuesday on the back of a dip in the dollar. U.S. gold futures eased 0.2% to $1,821.70.