Stock futures muscled higher in Friday’s premarket session, as big banks began rolling out fourth quarter results ahead of the holiday weekend.
XFutures for the Dow Jones industrial average leapt 0.4% above fair value. S&P 500 futures were up 0.3%. Nasdaq 100 futures advanced 0.2%, held back by Facebook’s (FB) early decline.
The Dow and S&P 500 each rolled up gains of 3.5% for the week through Thursday. The Nasdaq Composite ran ahead 4.5% — its strongest week since July.
Overseas news factored into Thursday’s premarket action. Germany’s Angela Merkel succeeded Friday in hashing out a deal between her conservative Union bloc and the center-left Social Democrats, allowing the country to move forward with a coalition government. The deal, which suggests more cooperation with France in strengthening a eurozone facing the U.K.’s Brexit, sent the euro to a three-year high vs. the dollar.
Europe’s markets were only moderately positive, having largely priced in expectations for a coalition agreement. Frankfurt’s DAX and London’s FTSE 100 each rose 0.2%, and the CAC-40 in Paris was up 0.3% near midday. Frankfurt’s DAX went into Friday’s session up 2.8% so far in January, tracking toward its first monthly advance since January.
Hong Kong’s Hang Seng index powered ahead 0.9% Friday, leaving it with a 4.9% gain for the week and within 2% of its record high, set in October, 2007. In Japan, Tokyo’s Nikkei 225 slipped 0.2% as the yen rebounded from the dollar, pressuring the market’s export leaders. The Nikkei ended up 3.9% in its fifth straight weekly gain, and at its highest level since November, 1991.
JPMorgan, BlackRock Report; 3 Of 4 FANGs Rise
Wells Fargo jumped 0.3% as investors waited on its fourth-quarter results. JPMorgan and PNC Financial stuck to flat trade as investors dug into their releases.
JP Morgan reported a mixed quarter, beating on it earnings line and coming up short of analysts’ revenue targets. A statement from CEO Jamie Dimon called the GOP’s tax reform during the quarter “a significant positive outcome for the country,” and said “the cumulative effect of retained and reinvested capital in the U.S. will help grow the economy, ultimately growing jobs and wages.
JPMorgan shares ended Thursday’s session in a buy range above a three-weeks tight pattern with a 108.50 buy point.
Investment manager BlackRock (BLK) jumped almost 2%, after beating analysts fourth-quarter earnings and revenue targets by wide margins. BlackRock remains in a buy range through 546.88, above a three-weeks tight buy point at 520.84.
Facebook dropped 4%, apparently as investors reacted to a late Thursday announcement from Chief Executive Mark Zuckerberg that the company would alter its newsfeed so that posts from friends and families would receive priority over commercial postings. Analysts said the move could have an impact on ad sales, and Zuckerberg said he expected “some measures of engagement will go down. But I also expect the time you do spend on Facebook will be more valuable.”
Facebook shares have been trading tight, in a buy zone above a 184.35 buy point. But the IBD 50 stock’s Relative Strength line has been lagging since November, sending a caution sign.
December Consumer Prices, Retail Sales Coming Up
The Labor Department’s December Consumer Price Index is expected at 8:30 a.m. ET, as well as December retail sales numbers from the Commerce Department. Commerce’s November business inventories estimates are due at 10 a.m.ET, and Baker Hughes (BHGE) releases its weekly rig count report at 1 p.m. ET.
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