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Dow Jones Industrial Average Futures Fall with Apple, Oil

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Oct 26, 2016 at 9:10 AM
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Dow Jones Industrial Average (DJIA) futures are trading below fair value this morning, with tech giant Apple Inc. (NASDAQ:AAPL) set for a post-earnings slump. The iPhone maker posted its first year-over-year decline in revenue in 15 years, though Apple said it expects to return to growth this quarter. Still, AAPL's 3% drop in electronic trading is overshadowing upbeat results for fellow Dow stocks The Coca-Cola Co (NYSE:KO) and Boeing Co (NYSE:BA). Meanwhile, oil prices are on pace for a third straight day of losses, with December-dated crude futures down 1.6% at $49.14 per barrel, ahead of today's report on domestic crude inventories. 

Continue reading for more on today's market, including: 

U.S. Stock Futures October 26

Futures on the Dow Jones Industrial Average (DJIA) are 49 points below fair value. 

5 Things You Need to Know Today
  1. The Chicago Board Options Exchange (CBOE) saw 839,103 call contracts traded on Tuesday, compared to 577,599 put contracts. The resultant single-session equity put/call ratio moved up to 0.69, while the 21-day moving average remained at 0.64.
  2. Southwest Airlines Co (NYSE:LUV) is set for an 8% decline when the market opens, after the airline posted a 33% drop in quarterly profits. The company cited July's technology outage for the sharp decline. LUV was already lower on a year-to-date basis, and today's move will put the shares back below the round $40 level
  3. Burrito expert Chipotle Mexican Grill, Inc. (NYSE:CMG) is down almost 4% ahead of the open, after the company reported disappointing third-quarter results. As such, analysts are again slashing their expectations. For example, Jefferies lowered its price target to $300, and Deutsche Bank cut its price target to $280 -- both representing territory not seen since January 2013, and more than a 25% decline to current levels. 
  4. After gapping higher following last quarter's earnings release, healthcare stock Edwards Lifesciences Corp (NYSE:EW) is eyeing a 12% post-earnings slide this time around. Despite matching Wall Street's per-share profit forecast and upping its full-year earnings guidance, the company's third-quarter sales missed expectations. Although a number of analysts cut their price targets, the majority kept their marks above last night's close of $113.68. 
  5. International trade data and new home sales come out today. Highlighting the post-close earnings slate will be Tesla Motors (TSLA), Groupon (GRPN), and NXP Semiconductors (NXPI).

Buzz Stocks Oct 26

Overseas Trading

Stocks in Asia ended the session mostly lower, with a dip in oil prices weighing on energy issues. Specifically, crude oil pulled back amid expectations that U.S. stockpiles rose last week and signs that Russia won't sign on to the Organization of the Petroleum Exporting Countries' (OPEC) proposed output cuts. Additionally, disappointing earnings from Apple put pressure on the tech titan's regional suppliers.

Drilling down, South Korea's Kospi gave up 1.1% following reports mainland China travel agencies were ordered to reduce tourism to the peninsula. Elsewhere, Hong Kong's Hang Seng dropped 1%, while China's Shanghai Composite slipped 0.5%. Japan's Nikkei bucked the downbeat global trend, adding 0.2% amid a round of relatively upbeat earnings reports.

Lower crude oil prices are also weighing on European markets, where the major indexes are in the red at midday. Earnings remain in focus, with traders digesting the latest results, including a 10% increase in quarterly sales for luxury goods maker Kering, and a 3% year-over-year slide in third-quarter profit for Britain's Lloyds Banking Group. At last check, London's FTSE 100 is off 1%, France's CAC 40 has shed 0.6%, and Germany's DAX has dropped 0.8%. 

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