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Friday, March 31, 2023

Wall St set to dip at open on tariff fears

Wall St set to dip at open on tariff fearsNEW YORK: US stocks were set to open lower on Thursday as strong earnings, including from Microsoft, failed to ease fears of a trade war after President Donald Trump said he was ready to impose tariffs on $500 billion worth of Chinese imports.

Trump’s comments on tariffs, which followed the United States and China imposed tariffs on $34 billion worth of each other’s goods this month, worried investors already grappling with the impact of a strengthening dollar on corporate results.

The latest round of US tariffs on $200 billion worth of Chinese goods, held up for now by a formal public comment period, could impact Apple Inc’s watches, several Fitbit activity trackers and connected speakers from Sonos.

“The market does tend react whenever there is a statement on tariffs,” said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

“The market was weak yesterday and often times in the absence of news to swing it to the other direction, you’ll get a little bit of follow through.”

However, after sliding early in the session, stock futures have steadily pared losses as strong quarterly reports from Microsoft as well as industrial conglomerates General Electric and Honeywell helped shift focus back to the earnings season.

Microsoft rose 3.4 percent after its quarterly results topped estimates on strong performance of its Azure cloud computing business.

GE was up 0.1 percent after its quarterly profit fell less than expected profit as weakness in power and renewables energy offset gains in its aviation, oil and gas and healthcare units.

Honeywell gained 2.7 percent after its neat quarterly profit estimates and raised its forecast on strong sales of aircraft parts and services.

As the second-quarter reporting period gains momentum, analysts forecast have risen as more companies top profit expectations.

Earnings at S&P 500 companies are forecast to have risen 21.5 percent, compared with the 20.7 percent gain seen on July 1, according to Thomson Reuters I/B/E/S.

At 8:57 a.m. ET, Dow e-minis were down 131 points, or 0.52 percent. S&P 500 e-minis were down 8.5 points, or 0.30 percent and Nasdaq 100 e-minis were up 2.25 points, or 0.03 percent.

However, not all results were rosy.

Skechers USA plunged 27.4 percent after the shoemaker posted disappointing quarterly results and forecast.

On the other hand, VF Corp rose 3.7 percent after the Vans sneaker maker reported robust quarterly results and raised its forecast.

State Street dropped 5.6 percent after the US custodian bank said it would buy Charles River Development for $2.6 billion in cash and fund the deal by suspending shares buybacks and issuing new equity.

Copyright Reuters, 2018

Source: Brecorder

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