Disappointing Guidance from GM, Boeing May Weigh on Wall Street

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By Investors Hub

The major U.S. index futures are once again pointing to a lower opening on Wednesday, with stocks likely to move to the downside following the strength seen in the previous session.

The downward momentum on Wall Street comes after General Motors (GM) and Boeing (BA) provided disappointing guidance.

GM reported better than expected second quarter results but lowered its full-year earnings forecast due to rising steel and aluminum costs as a result of the tariffs imposed by President Donald Trump’s administration.

Aerospace giant Boeing also reported second quarter results that exceeded analyst estimates but warned of lower than expected margins for its defense business in 2018.

After an early move to the upside, stocks remained mostly positive during trading on Tuesday. The Dow and the S&P 500 closed firmly in positive territory, although the tech-heavy Nasdaq ended the day just below the unchanged line.

The Nasdaq edged down 1.11 points or less than a tenth of a percent to 7,840.77, while the Dow climbed 197.65 points or 0.8 percent to 25,241.94 and the S&P 500 rose 13.42 points or 0.5 percent to 2,820.40.

The strength on Wall Street partly reflected a positive reaction to the latest earnings news from big-name companies such as Google parent Alphabet (GOOGL).

Shares of Alphabet jumped by 3.9 percent on the day after the tech giant reported better than expected quarterly results.

Drug giant Eli Lilly (LLY) also saw significant strength after reporting second quarter results that exceed expectations and announcing plans to spin off its Elanco Animal Health unit.

Trading activity was somewhat subdued, however, with a lack of major U.S. economic data likely keeping some traders on the sidelines.

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