U.S. equities were looking at a potentially downbeat start to the week, as stock futures tumbled Monday on weaker-than-expected China trade data that has sparked fresh concerns over a global economic slowdown.
How are major benchmarks faring?
Dow Jones Industrial Average futures
slid 210 points, or 0.9%, to 23,742, while S&P 500 futures
fell 23.35 points, or 0.9%, to 2,571.75. Nasdaq-100 futures
dropped 75.50 points, or 1.1%, to 6,538.
On Friday, the Dow Jones Industrial Average
fell 5.97 points to 23,995.95, while the S&P 500 index
slipped 0.38 point to 2,596.26. The Nasdaq Composite Index
shed 14.59 points, or 0.2%, to 6,971.48.
For the week, the Dow rose 2.4%, the S&P 500 gained 2.5%, and the Nasdaq rallied 3.5%.
What’s driving the market?
Appetite for perceived riskier assets such as stocks took a hit Monday, after data showed weak China imports and exports for December, which underpinned worries of a slowdown in the global growth engine. And China’s trade surplus with the U.S. soared to a fresh record of $323.32 billion in 2018, while the two countries continue to try resolving those differences.
Earnings season will kick off on Monday, with Citigroup Inc.
scheduled to report ahead of the bell. JP Morgan Chase & Co.
Wells Fargo & Co.
, BlackRock Inc.
Goldman Sachs Group Inc.
and Netflix Inc.
are a few of the other big companies due to report this week.
Investors are jittery ahead of the start of the fourth-quarter earnings reporting season after high- profile warnings from Apple Inc.
Brexit concerns will rise to the forefront this week as U.K. lawmakers get ready to vote on Prime Minister Theresa May’s divorce deal with the European Union Tuesday. U.K. opposition leader Jeremy Corbyn said Sunday the Labour Party will push for a general election if Parliament rejects May’s deal, and that he might force a vote of no-confidence “soon.”
What are strategists saying?
“Analysts have been backpedaling earnings expectations faster than usual in the run-up to the Q4 releases. Apple’s high-profile warning may have unduly lowered the bar for other firms,” said Jasper Lawler, head of research at London Capital Group, in a note to clients.
“Expect roughly 10% earnings growth, lower than last quarter but still very strong, albeit Q4 looks likely to be a bit patchier than the across-the-board wins we had in Q3. The effect of tax cuts will start to seen annualizing out,” he said.
How are other markets trading?
Asia markets finished weaker, led by a 1.4% drop in Hong Kong’s Hang Seng Index
traded lower across the board.
A risk-off atmosphere also drove down oil prices, with West Texas Intermediate crude
for February down 1.2% to $50.98 a barrel. Gold
was bid slightly higher, up 0.4% to $1,294 an ounce, and the ICE Dollar Index
slipped 0.1% to 95.571.
Which stocks to watch?
Shares of PG&E Corp.
plummeted 55% in premarket trade Monday, after the gas and electric company said it plans to file for bankruptcy on or about Jan. 29.
Gannett Co. Inc.’s stock
popped in premarket action Monday after private-equity firm MNG announced a deal to buyout the owner of USA Today.
Shares of Goldcorp Inc.
were active after Newmont Mining Corp.
said it planned on buying the miner in a deal valued at $10 billion.
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