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Earnings Weigh On Global Markets, Brexit Outlook Dims, Trade Tensions Elevated

Thomas Hughes

The U.S. Futures Fall In Early Trading

The U.S. index futures are moving lower in early Friday trading. The weakness is driven by poor earnings results from Amazon and a few other key players that point to softness in the 4th quarter. Amazon missed on the top and bottom lines, the bottom line miss exaggerated by a decline in net margin, which led the company to lower 4th quarter guidance. The news cause a stir among investors and sent shares down more than -6.5% in early trading. Despite this, the tech-heavy NASDAQ Composite is leading early action and down only -0.07%. The Dow Jones Industrials and S&P 500 are both down close to -0.20%.

In other news, shares of 3M, Twitter, and Verizon are on the move. Shares of 3M and Twitter are moving lower after reporting big misses on Thursday. Shares of Verizon are up 0.70% in early trading. In economic news, the only report due out this morning is Consumer Confidence at 10AM. Next week we can expect reports on labor, the consumer, inflation, manufacturing, and of course the FOMC policy decision. The odds for a cut are running just over 93%.

Europe Moves Mostly Lower, UK Politics Begins To Heat Up Again

European markets moved mostly lower in early Friday trading. The CAC is the only major index to post a gain at midday, the DAX and FTSE are both in the red. The UK FTSE 100 is in the lead with a decline of -0.50% as politics begin to heat up once again. The EU has granted an extension but has yet to determine a timeline. UK Prime Minister Boris Johnson, meanwhile, is seeking to consolidate his power with a general election. The polls are showing his Conservative Party in the lead, he aims to gain a clear majority in Parliament in order to usher the UK to Brexit.

In stock news, Shares of Barclays are moving higher despite a decline in earnings. The market had expected worse results and outlook, shares are up 1.0%. Kering, luxury goods retailer, and competitor Moncler both saw their shares rise 10% after reporting stronger than expected revenue and earnings.

Asia Up, EPS and Trade In Focus

Asia is mostly higher in Friday trading as earnings and trade hope lift stocks. In trade news, U.S. Vice President Mike Pence made prepared comments that at once calm nerves and stoke fears. Pence says the U.S. does not seek confrontation with China, he also made clear China is behaving in a manner not acceptable to the Trump administration. The Shanghai Composite closed with a gain of 0.50%, while the ASX led with a gain closer to 0.70%. The Nikkei and Kospi both closed with gains near 0.15%. The Hong Kong Hang Seng is the only index to close with a loss.

This article was originally posted on FX Empire

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