Dow Futures Gain With Bank Earnings In Focus After Eli Lilly COVID Antibody Trial Pause
New York (Oct 14) U.S. equity futures powered higher Wednesday, shrugging off concerns of yet another potential delay in coronavirus treatment development, as markets continue to focus on corporate earnings and extended gains for tech stocks.
Eli Lilly's (LLY) - Get Report decision to pause trials of its developing coronavirus therapy treatment over unspecified safety concerns, as well as reports that suggest the Food & Drug Administration was involved, hit markets hard on Tuesday, but looks to have little effect today heading into another busy session for bank and healthcare earnings.
The ongoing deadlock on stimulus in Washington, meanwhile, is also have little effect on sentiment, given that investors feel a victory in next month's Presidential elections for Joe Biden, and a potential sweep of both Houses of Congress, will lead to a larger, more comprehensive aid package in the early months of next year.
The trillions on offer may be needed to quell the impact of what appears to be a damaging second wave of coronavirus infections, if Europe's past experience is any guide, as lockdown orders spread around the Continent this week following record case counts in several member states.
U.S. stocks, however, are set for another solid open ahead of earnings from Wells Fargo (WFC) - Get Report, with contracts tied to the Dow Jones Industrial Average suggesting a 44 point opening bell gain and those linked to the S&P 500 indicating a 1 point advance for the broader benchmark.
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Goldman Sachs (GS) - Get Report shares jumped nearly 3% to $217.00 each in pre-market trading after it blasted Street forecasts with a bottom line of $9.68 per share on revenues of $10.78 billion.
Bank of America (BAC) - Get Report shares fell more nearly 2% in pre-market trading following its third quarter earnings, which showed a surprise 17% slump in net interest income and softer-than-forecast total revenues of $20.3 billion,
Tech stocks, again, are likely to lead the day's gains with the Nasdaq called 48 points to the good following stronger-than-expected third quarter earnings, and a robust 2021 growth forecast, from ASML, the European semiconductor equipment maker that counts Intel INTC, Samsung and Taiwan Semiconductor as clients for its $200 million lithography machines.
ASML's earnings, as well as a weaker euro, helped European stocks to early gains Wednesday, with the Stoxx 600 rising 0.25% and Britain's FTSE 100 gaining 0.25% despite the 'three-tier' lockdown put in place earlier this week by U.K. Prime Minister Boris Johnson.
Away from equities, the U.S. dollar index extended gains against a basket of its global currency peers to trade 0.07% higher at 93.595, while benchmark 10-year Treasury note yields continued to rally, falling to 0.726% amid the broader risk market caution.
Global oil prices slipped lower as the dollar posted modest gains and traders continue to worry about the demand side of price discovery now that Gulf of Mexico drillers are back on line following Hurricane Delta and OPEC members appear eager to add more crude to the market in the coming months.
WTI contracts for November delivery, the new U.S. benchmark, traded 18 cents lower from their Tuesday close in New York and were changing hands at $40.02 per barrel in early European dealing while Brent contracts for December, the global benchmark, were seen 16 cents lower at $42.31 per barrel.
Overnight in Asia, Wall Street's late-hour sell off held down gains for the Nikkei 225 in Tokyo, which managed to post a 0.11% advance thanks in part to a weaker yen, while the region-wide MSCI ex-Japan benchmark slipped 0.12% lower heading into the final hours of trading.
TheStreet
