Dow Jones Industrial Average Futures Edge Higher on Tech Earnings

Rare Signal Says Investor Confidence is Fading Fast

Jan 27, 2017 at 9:05 AM
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Dow Jones Industrial Average (DJIA) futures are modestly higher, setting up the index for a potential fourth straight win, and possibly even another record high. While uncertainty is running high ahead of President Donald Trump's meeting with U.K. Prime Minister Theresa May, traders are chewing on earnings data. For example, Dow stocks Intel Corporation (NASDAQ:INTC) and Microsoft Corporation (NASDAQ:MSFT) topped earnings expectations, while Chevron Corporation (NYSE:CVX) missed -- as did internet giant Alphabet Inc (NASDAQ:GOOGL). Meanwhile, fourth-quarter gross domestic product (GDP) came in at a disappointing 1.9%, and durable goods orders posted a surprise drop in December.

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

  • This rare signal suggests investor confidence is fading fast.
  • Why you can't trust the recent buy signal on this railroad stock.
  • Could a double-barreled level of technical support save Ford Motor Company (NYSE:F) shares?
  • Plus, General Dynamics' mixed results, the airline stock set to soar, and Starbucks slashes its outlook.

dow futures jan 27

Futures on the Dow Jones Industrial Average (DJIA) are roughly 16 points above fair value.

5 Things You Need to Know Today
  1. The Chicago Board Options Exchange (CBOE) saw 936,991 call contracts traded on Thursday, compared to 606,704 put contracts. The resultant single-session equity put/call ratio rose to 0.65, while the 21-day moving average remained at 0.65.
  2. Defense contractor General Dynamics Corporation (NYSE:GD) reported earnings that exceeded the consensus view, but revenue came in shy of estimates. "The quarter is solid, showing strong growth over the year-ago quarter in both revenue and earnings and the same was true on a sequential basis," said CEO Phebe Novakovic.
  3. Shares of American Airline Group Inc (NASDAQ:AAL) have soared 2% ahead of the open -- and could challenge their annual high in today's session -- after the company's adjusted per-share earnings of $1.48 blew past the consensus estimate. Quarterly revenue also was better than expected, albeit barely.
  4. Starbucks Corporation (NASDAQ:SBUX) is set to drop 4% at the open, after the java giant cut its 2017 revenue forecast, and said fiscal first-quarter same-store sales missed estimates. While adjusted per-share earnings did squeak past the Street's expectations, that didn't stop normally bullish analysts from tempering their expectations -- with Barclays, J.P. Morgan Securities, and Buckingham Research all cutting their price targets.
  5. The week wraps up with the Thomson Reuters/University of Michigan consumer sentiment survey. AbbVie (ABBV), Colgate-Palmolive (CL), and Honeywell (HON) will release earnings. 

stocks on the move today jan 27

Overseas Trading

With global traders focusing on the growing tensions between Mexico and the U.S. -- and with Chinese and South Korean markets closed for the Lunar New Year holiday -- there was little to digest in Asia. Nevertheless, Japan's Nikkei managed a 0.3% advance, after data showed consumer prices fell at a slower pace than expected last month. Japanese conglomerate Toshiba was in the headlines again, after announcing plans to split off its memory chip division, which sent the shares higher. Elsewhere, Hong Kong's Hang Seng closed an abbreviated session down 0.1%.

Stocks are struggling at midday in Europe. A post-earnings drop for shares of banking giant UBS Group is in focus, dragging down sector peers across the region. On the flip side, supermarket stock Tesco is rallying on news the company has reached an agreement to buy Booker Group for nearly $5 billion. Traders will also be awaiting updates from the meeting between May and Trump later today. London's FTSE 100 was slightly lower at last check, while Germany's DAX is down 0.2%, and the French CAC 40 is off 0.5%. 

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