5 Things You Need To Know In Financial Markets

5 Things You Need To Know In Financial Markets

 

  1. Earnings set to drive the session

 

The first-quarter earnings season will drive stocks on Tuesday with another report from the financial sector, figures from three Dow components and numbers from video-streamer Netflix.

 

Bank of America (NYSE:BAC) is set to report before the open in the wake of disappointing updates on Monday from both Goldman Sachs (NYSE:GS) andCitigroup (NYSE:C).

 

UnitedHealth (NYSE:UNH) and Johnson & Johnson (NYSE:JNJ) will accompany BofA ahead of the open, while IBM (NYSE:IBM) will give the latest details of its cloud business after the close.

 

Netflix (NASDAQ:NFLX) is also due after the close. Investors will pay close attention to the effects of intensifying competition. Disney’s recent announcement that it expects to start a streaming service in November has put downward pressure on Netflix’s shares.

 

While waiting for earnings, U.S. futures pointed to a slightly higher open. At 5:52 AM ET (9:52 GMT), the blue-chip Dow futures gained 99 points, or 0.4%, S&P 500 futures traded up 9 points, or 0.3%, while the Nasdaq 100 futures advanced 32 points, or 0.4%.

 

  1. AT&T sells back Hulu stake, giving Disney an edge

 

Hulu has repurchased the 9.5% stake that AT&T (NYSE:T) had in the company for $1.43 billion, valuing the streaming company at around $15 billion.

 

The repurchase cements Disney’s control of the streaming service. Disney (NYSE:DIS) holds a 60% stake in Hulu through a joint venture.

 

AT&T, the ultimate owner of HBO, said it plans to use the proceeds from the transaction to pay down debt..

 

  1. Housing, Industrial Production Data Due

 

Even with earnings in the spotlight, there are still economic indicators to keep in mind.

 

At 10:00 AM ET (14:00 GMT), the National Association of Home Builders issues its April housing market index for investors keeping a close eye on the real estate market.

 

March industrial production numbers will also provide input on the strength of the economy at 9:15 AM ET (13:15 GMT).

 

Elsewhere, Robert Kaplan, president of the Dallas Federal Reserve Bank, will make an appearance at 2:00 PM ET (18:00 GMT). Chicago Fed chief Charles Evansindicated on Monday he was “comfortable” with keeping interest rates on hold until the fall of 2020.

 

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.1% at 96.66 by 5:53 AM ET (9:53 GMT), while the yield on the 10-year Treasury inched up 0.3 basis points to 2.56%.

 

  1. Oil prices struggle ahead of U.S. inventory data

 

Oil was little changed on Tuesday, taking a breather from a recent rally, amid concerns about the future of the output restraint deal between OPEC and Russia.

 

The American Petroleum Institute’s snapshot of weekly U.S. oil stockpiles is due at 4.30 PM ET, a day ahead of the official government tally.

 

The API data has shown three straight weeks of builds, and last week’s reading from the Energy Information Administration saw a surge of more than 7 million barrels.

 

  1. Lufthansa reports surprise loss, U.S. airlines on watch

 

Lufthansa, Germany’s biggest airline, reported an adjusted loss of €336 million($413.5 million) in the first quarter, sending shares sharply lower in and dragging its European peers lower with it.

 

The airline blamed the loss on rising fuel costs and lower fares due to overcapacity. U.S. airlines such as Delta Air Lines (NYSE:DAL), United Continental (NASDAQ:UAL) and American Airlines (NASDAQ:AAL) have so far avoided taking fuel-related hits to earnings but may not be able to do so for much longer, given the steady rise in fuel prices.

 

Delta’s own first-quarter report wowed investors last week as the airline produced record revenue and a large jump in profit.

 

 

  1. Earnings set to drive the session

 

The first-quarter earnings season will drive stocks on Tuesday with another report from the financial sector, figures from three Dow components and numbers from video-streamer Netflix.

 

Bank of America (NYSE:BAC) is set to report before the open in the wake of disappointing updates on Monday from both Goldman Sachs (NYSE:GS) andCitigroup (NYSE:C).

 

UnitedHealth (NYSE:UNH) and Johnson & Johnson (NYSE:JNJ) will accompany BofA ahead of the open, while IBM (NYSE:IBM) will give the latest details of its cloud business after the close.

 

Netflix (NASDAQ:NFLX) is also due after the close. Investors will pay close attention to the effects of intensifying competition. Disney’s recent announcement that it expects to start a streaming service in November has put downward pressure on Netflix’s shares.

 

While waiting for earnings, U.S. futures pointed to a slightly higher open. At 5:52 AM ET (9:52 GMT), the blue-chip Dow futures gained 99 points, or 0.4%, S&P 500 futures traded up 9 points, or 0.3%, while the Nasdaq 100 futures advanced 32 points, or 0.4%.

 

  1. AT&T sells back Hulu stake, giving Disney an edge

 

Hulu has repurchased the 9.5% stake that AT&T (NYSE:T) had in the company for $1.43 billion, valuing the streaming company at around $15 billion.

 

The repurchase cements Disney’s control of the streaming service. Disney (NYSE:DIS) holds a 60% stake in Hulu through a joint venture.

 

AT&T, the ultimate owner of HBO, said it plans to use the proceeds from the transaction to pay down debt..

 

  1. Housing, Industrial Production Data Due

 

Even with earnings in the spotlight, there are still economic indicators to keep in mind.

 

At 10:00 AM ET (14:00 GMT), the National Association of Home Builders issues its April housing market index for investors keeping a close eye on the real estate market.

 

March industrial production numbers will also provide input on the strength of the economy at 9:15 AM ET (13:15 GMT).

 

Elsewhere, Robert Kaplan, president of the Dallas Federal Reserve Bank, will make an appearance at 2:00 PM ET (18:00 GMT). Chicago Fed chief Charles Evansindicated on Monday he was “comfortable” with keeping interest rates on hold until the fall of 2020.

 

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.1% at 96.66 by 5:53 AM ET (9:53 GMT), while the yield on the 10-year Treasury inched up 0.3 basis points to 2.56%.

 

  1. Oil prices struggle ahead of U.S. inventory data

 

Oil was little changed on Tuesday, taking a breather from a recent rally, amid concerns about the future of the output restraint deal between OPEC and Russia.

 

The American Petroleum Institute’s snapshot of weekly U.S. oil stockpiles is due at 4.30 PM ET, a day ahead of the official government tally.

 

The API data has shown three straight weeks of builds, and last week’s reading from the Energy Information Administration saw a surge of more than 7 million barrels.

 

  1. Lufthansa reports surprise loss, U.S. airlines on watch

 

Lufthansa, Germany’s biggest airline, reported an adjusted loss of €336 million($413.5 million) in the first-quarter, sending shares sharply lower in and dragging its European peers lower with it.

 

The airline blamed the loss on rising fuel costs and lower fares due to overcapacity. U.S. airlines such as Delta Air Lines (NYSE:DAL), United Continental (NASDAQ:UAL) and American Airlines (NASDAQ:AAL) have so far avoided taking fuel-related hits to earnings but may not be able to do so for much longer, given the steady rise in fuel prices.

 

Delta’s own first-quarter report wowed investors last week as the airline produced record revenue and a large jump in profit.

 

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