Futures Flat, Brexit Deal Expected To Flop, China GDP Weaker Than Expected

Global markets are flat as concerns for global economic stability outweigh earnings.
Thomas Hughes

Futures Are Flat In Early Trading

Futures trading is indicating a flat to a slightly positive open in early action on Friday. The Dow Jones Industrial Average, S&P 500, and NASDAQ Composite are all up about 0.05% in the premarket session. The market is supported by positive earnings but the outlook for global economic activity is capping gains. Today’s GDP data from China is only the latest in a string of weak economic releases pointing to the impact of the ongoing trade war. China says GDP grew 6.0% in the 3rd quarter, a tenth weaker than expected and a 27-year low. The index of Leading Indicators is due out at 10 AM.

In earnings news, earnings continue to roll in better than expected. Today’s reports include news from American Express, Coca-Cola and Schlumberger. American Express and Coca-Cola both beat citing strength in consumer spending. Schlumberger also beat but due to demand for oil-field services. American Express reaffirmed guidance in a range bracketing consensus and shares gained 1.66%. Coca-Cola raised guidance and saw its shares rise by 2.5%. Schlumberger is up about 1.25% in the early pre-market session.

Brexit Deal Passes, But Maybe Not

EU markets are flat at midday as concerns over the Brexit intensify. EU and UK leaders announced a new deal earlier in the week but that deal is yet to pass Parliament. Ratified 100% by EU leaders, the deal faces opposition in Parliament that is likely to prevent its passage. In last report, the Northern Irelands DUB party said it will not vote in favor. The CAC is leading the market with a loss of -0.40% while the DAX and FTSE are both hugging break-even levels.

In stock news, autos led today’s decline with a loss of -1.6%. The move is driven by a profit warning from Renault that suggests weakness throughout the industry. In other news, med-tech company Getinge is up more than 17% after it exceeded quarterly expectations.

Asian Markets Mostly Lower

Asian markets are mostly lower at the end of Friday’s session due to weakness in China’s economy. The GDP read suggests economic activity will continue to slow faster than economists expect. China is expected to slow to around 5.0% in the next few years, today’s data ups the chances for additional stimulus this year. The Nikkei is the only index to move higher, it advanced 0.18%. The Shanghai Composite led with a loss of -1.32% while most others fell about -0.65%.

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