Futures Pointing to Roughly Flat Open on Wall Street
By Investors Hub
The major U.S. index futures are pointing to a roughly flat opening on Monday, with stocks likely to show a lack of direction following the strong upward move seen last week.
Traders may be reluctant to make significant moves ahead of the release of quarterly financial results from a number of big-name companies this week.
Netflix (NFLX), Goldman Sachs (GS), Johnson & Johnson (JNJ), Morgan Stanley (MS), American Express (AXP), IBM Corp. (IBM), Microsoft (MSFT), and General Electric (GE) are among the companies due to report their results in the coming days.
Nonetheless, some buying interest may be generated in reaction to a report from the Commerce Department showing retail sales in the U.S. increased in line with economist estimates in the month of June.
After ending Thursday?s trading substantially higher, stocks turned in a relatively lackluster performance during trading on Friday. Despite the choppy trading, the Nasdaq hit a new record high and the S&P 500 reached its best closing level in five months.
The major averages fluctuated over the course of the session before closing modestly higher. The Dow rose 94.52 points or 0.4 percent to 25,019.41, the Nasdaq inched up 2.06 points or less than a tenth of a percent to 7,825.98 and the S&P 500 edged up 3.02 points or 0.1 percent to 2,801.31.
For the week, the Dow surged up by 2.3 percent, while the Nasdaq and the S&P 500 jumped by 1.8 percent and 1.5 percent, respectively.
The choppy trading on Wall Street came as traders seemed reluctant to make significant moves on the heels of the considerable volatility seen over the past few sessions.
Traders were also digesting mixed quarterly results from financial giants JPMorgan Chase (JPM), Citigroup (C) and Wells Fargo (WFC).
JPMorgan Chase ended the day moderately lower despite reporting second quarter results that exceeded expectations on both the top and bottom lines.
Meanwhile, shares of Wells Fargo showed a significant move to the downside after the bank reported second quarter earnings and revenues that came in below analyst estimates.
Citigroup also came under pressure after reporting better than expected second quarter earnings but on revenues that came in below expectations.
In U.S. economic news, the Federal Reserve delivered its semi-annual monetary policy to Congress, offering few surprises.
The Fed described economic growth in the first half of the year as solid and reiterated it expects further gradual increases in interest rates.
“The Federal Reserve remains positive on the U.S. economic outlook with barely any mention of the trade or yield curve worries that are preoccupying markets,” said James Knightley, Chief International Economist at ING.
Meanwhile, the University of Michigan released a report showing an unexpected decrease in consumer sentiment in the month of July due to concerns about potential impact of tariffs.
The preliminary report said the consumer sentiment index dipped to 97.1 in July from the final June reading of 98.2. Economists had expected the index to come in unchanged.
A separate report released by the Labor Department showed an unexpected decrease in import prices in the month of June but a slightly bigger than expected increase in export prices.
The Labor Department said import prices fell by 0.4 percent in June after climbing by an upwardly revised 0.9 percent in May.
The pullback surprised economists, who had expected import prices to inch up by 0.1 percent compared to the 0.6 percent increase originally reported for the previous month.
On the other hand, the report also said export prices rose by 0.3 percent in June following a 0.6 percent increase in May. Economists had expected export prices to edge up by 0.2 percent.
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster close by the broader markets.
Energy stocks saw some strength amid a rebound by the price of crude oil, while weakness was visible in the telecom and banking sectors.