U.S. index futures are little changed with equities at record

STOCK-INDEX FUTURES in the United States gave little guidance as to where the equity markets are headed Wednesday morning, as wide-ranging news continue to cloud what is ahead for investors and policy makers.  / BLOOMBERG NEWS FILE PHOTO/MICHAEL NAGLE
STOCK-INDEX FUTURES in the United States gave little guidance as to where the equity markets are headed Wednesday morning, as wide-ranging news continue to cloud what is ahead for investors and policy makers. / BLOOMBERG NEWS FILE PHOTO/MICHAEL NAGLE

NEW YORK – U.S. stock-index futures were little changed, while investors weighed prospects of further gains with equities at record levels and corporate earnings projected to decline for a fifth quarter.

Contracts on the S&P 500 Index expiring in September rose 0.2 percent to 2,149.5 at 8:42 a.m. in New York. Futures on the Dow Jones Industrial Average added 23 points to 18,287 after the 30-share gauge joined the benchmark index in extending an all-time high. The CBOE Volatility Index, the gauge of market turbulence known as the VIX, fell for the first time in three days on Wednesday.

“There should be a reality check,” said Frances Hudson, a strategist at Standard Life Investments Ltd. in Edinburgh, U.K. “Earnings probably aren’t so strong. Markets seem to have been looking through an awful lot, given that there is a lot of uncertainty, particularly on geopolitics.”

Growing confidence that the Federal Reserve will refrain from raising interest rates this year, along with speculation other central banks will further loosen monetary policy, helped stocks recoup losses incurred after the United Kingdom voted to leave the European Union. Alcoa Inc.’s better-than-estimated earnings was an encouraging start to the quarterly reporting period, though analysts project a 5.7 percent decline in profits of S&P 500 companies.

- Advertisement -

Combined net income at the six biggest U.S. banks will fall 18 percent in the second quarter from a year earlier, analysts surveyed by Bloomberg estimated. For the full year, it is predicted to drop 14 percent. JPMorgan Chase & Co., Citigroup Inc. and BlackRock Inc. will report results this week.

The S&P 500 has advanced 7.6 percent over the 10 sessions that followed the worst two-day selloff since last August, a drop sparked by the Brexit vote that sent the gauge down 5.3 percent. In addition to the speculation of more stimulus from central banks, reports showing a rebound in job growth last month and the fastest expansion in services industries in seven months help propel the biggest climb over any such stretch since December 2011.

With stocks back at all-time highs, global market turmoil subsiding and U.S. economic data showing improvement, wagers on Fed rate increase have begun to rise. Chances for a move by December are about 32 percent from 12 percent a week ago, according to data compiled by Bloomberg. The first month with at least even odds of higher borrowing costs is now June 2017 after previously being pushed out beyond next year. The Fed releases its Beige Book survey of regional economic activity Wednesday afternoon.

Among shares moving on corporate news, Juno Therapeutics Inc. advanced 23 percent in premarket trading after U.S. regulators allowed the company to resume a clinical trial of its lead product. The stock dropped 32 percent on Friday after officials put the study on hold.

No posts to display