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Top 5 Things to Know in The Market on Thursday

Investing.com - Here are the top five things you need to know in financial markets on Thursday, January 17:

1. U.S. Steps Up Pressure on Huawei and ZTE

A bipartisan group of U.S. lawmakers introduced bills that would ban the sale of U.S. chips or other components to Huawei Technologies, ZTE Corp (HK:0763) or other Chinese telecommunications companies that violate U.S. sanctions or export control laws.

The proposed law drew sharp criticism from China where Foreign Ministry spokeswoman Hua Chunying called the U.S. legislation "hysteria", intensifying a bitter trade war between Beijing and Washington.

The legislation is the latest in a long list of actions taken to fight what some in the Trump administration call China's cheating through intellectual property theft, illegal corporate subsidies and rules hampering U.S. corporations that want to sell their goods in China.

2. Wall Street Set for Lower Open

U.S. stock futures pointed to a lower open, as fresh frictions over Chinese tech giant Huawei added to worries over the ongoing U.S.-China trade dispute.

At 5:25AM ET (10:25 GMT), the blue-chip Dow futures were down 57 points, or about 0.2%, the S&P 500 futures fell 8 points, or around 0.3%, while the tech-heavy Nasdaq 100 futures indicated a decline of 26 points, or roughly 0.4%.

The moves in premarket come after Wall Street's major indexes hit one-month highs on Wednesday, after strong earnings from Bank of America (NYSE:BAC) and Goldman Sachs (NYSE:GS) boosted investor sentiment.

Elsewhere, European stocks were lower, with most major bourses across the region in negative territory, lacking the support from earnings that the U.S. market has enjoyed and overshadowed by warnings about the risk of a disorderly Brexit.

Earlier, markets in Asia closed mixed, with bourses in China leading losses.

3. Netflix Reports Earnings

Netflix (NASDAQ:NFLX) results due out after the closing bell will be today's main event.

The streaming giant is forecast to report adjusted earnings per share (EPS) of $0.25 on revenue of $4.21 billion for the fourth quarter, according to estimates.

Perhaps of greater interest than the bottom line number, Wall Street will be closely watching subscriber growth numbers, which usually play a much bigger role in how its stock moves post-earnings. Also look out for its growing needs to spend on content, as the company ramps up investment to drive an expansion that is now led by international users.

The company's financial results come on the back of a big announcement earlier this week that it is raising prices for its U.S. customers by 13% to 18%.

After getting clobbered during the market's December selloff, Netflix's stock has been on a tear over the last three weeks, rallying by a whopping 50% since Dec. 26.

It was down around 0.7% in Thursday's premarket.

4. Morgan Stanley Results Also in Focus

Besides Netflix, market participants will focus on financial results from Morgan Stanley (NYSE:MS), which is slated to release fourth quarter earnings at 6:55AM ET (11:55 GMT).

Analysts are forecasting earnings per share (EPS) of $0.90 on revenue of $9.35 billion. The same period of 2017 had $0.84 in EPS and $11.09 billion in revenue.

Also on the earnings docket for today are Fastenal (NASDAQ:FAST), and PPG Industries (NYSE:PPG), both set to post results in the morning, while American Express (NYSE:AXP) is due after the close along with JB Hunt (NASDAQ:JBHT) and Atlassian (NASDAQ:TEAM).


Read more: American Express Earnings Momentum Won't Impress Investors. Here's Why: Haris Anwar

5. Upcoming Data

On the data front, there will be weekly jobless claims as well as the Philly Fed manufacturing survey both due at 8:30AM ET (13:30 GMT).

Claims for first-time unemployment benefits for the latest week are expected to rise slightly to 219,000, while economists forecast that the Philly Fed index rose to 9.7 last month from 9.4 in December.

A speech from Federal Reserve Governor Randal Quarles at 10:45AM ET (15:45 GMT) will also be in focus.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, was a shade higher at 95.76.

In the bond market, U.S. Treasury yields inched lower, with the benchmark 10-year note standing at 2.71%, while the yield on U.S. government bonds with 2-year maturities was at 2.53%.

-- Reuters contributed to this report


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