Futures Flat, Brexit Uncertainty Wears On, Earnings Season Fails To Impress

The global market continues to tread water as earnings season ramps to high gear and global uncertainties simmer.
Thomas Hughes
Wall street in New York

The U.S. Market Is Down In Early Trading

The U.S. futures are down in early Wednesday trading as earnings from high-profile bellwethers fail to impress. The Dow Jones Industrial Average is hovering around break-even, moving between -0.15% and 0.15% in the premarket session. The S&P 500 and NASDAQ Composite are in a similar position. Today’s news includes reports from Caterpillar and Boeing among others.

Caterpillar reported weaker than expected top and bottom-line results and lowered full-year guidance. Shares of that stock held steady in early trading largely due to expected weakness. Shares of Boeing moved higher after it reported weak earnings. The company stands by its 737 Max timeline and that boosted investor confidence. Texas Instruments, a proxy for the semiconductor market, fell -9.0% after it reported weak results and outlook. Microsoft, Ford, and Tesla are expected to report after the close of the session.

There is no major economic data scheduled before the bell. Tomorrow, traders will be looking out for Flash PMI readings and New Home Sales.

European Markets Are Mixed

European markets are mixed at midday as uncertainty over Brexit reaches new highs. The UK Parliament passed Boris Johnson’s new deal in principle but rejected his timeline. Johnson wants the deal passed within three days in order to allow Brexit on October 31st. Parliament does not want to be pressured into the deal and now awaits the EU’s decision. The EU is expected to rule on an extension, already offered once, at any time. The FTSE 100 is in the lead with a gain near 0.25% while most others in the region are showing small losses.

In stock news, shares of PSA Peugeot Citroen are moving higher in midday action. The company reported solid results and provided positive guidance despite what it calls a weak market. Shares of Heineken are moving lower after missing expectations and lowering full-year guidance. Pandora saw its shares rise more than 12% after the company was upgraded to hold from sell at Raymond James.

Asia Mixed, Brexit Throws Global Outlook In Doubt

Asian markets are mixed although most indices closed lower in Wednesday trading. The Nikkei led with an advance of 0.34% after Tuesday’s holiday. The Hong Kong Hang Seng is the biggest loser at -0.84%. Along with the Brexit delay, an IMF downgrade of Asian economies is weighing on sentiment. The IMF cautions that Asian economic growth could be lower than expected.

In stock news, shares of Softbank fell -2.51% after it bailed out WeWork. SoftBank is investing billions into the money-losing start-up and assumed an 80% ownership stake. In South Korea, Apple supplier LG Display moved lower after it provided weaker than expected results and outlook.

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