ADP Report, Apple Send Dow Jones Industrial Average Futures Higher

What the January Barometer Could Signal for 2017

Feb 1, 2017 at 9:11 AM
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Dow Jones Industrial Average (DJIA) futures are trading above fair value, with stocks looking to recover from two days of heavy losses on Wall Street. As a historically bearish month gets underway, Apple Inc.'s (NASDAQ:AAPL) strong earnings report is stealing the show ahead of the open, while tech peer Facebook Inc (NASDAQ:FB) will release quarterly results after the close. Meanwhile, it's a huge day for economic data, with the ADP employment report for January showing 246,000 private-sector jobs added, blowing past forecasts of 165,000 -- a promising sign ahead of Friday's nonfarm payrolls report. Auto sales and manufacturing reports are among the other data points set to hit the Street, all leading up to this afternoon's policy decision from the Federal Open Market Committee (FOMC). 

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

US Stock Futures Feb 1

Futures on the Dow Jones Industrial Average (DJIA) are 62 points above fair value. 

5 Things You Need to Know Today
  1. The Chicago Board Options Exchange (CBOE) saw 794,933 call contracts traded on Tuesday, compared to 557,893 put contracts. The resultant single-session equity put/call ratio moved down to 0.70, while the 21-day moving average edged up to 0.67.
  2. AAPL is up 4.4% ahead of the open, after the company handily topped Wall Street's earnings and revenue estimates. This is obviously bad news for any option trader that was betting against Apple, with a number of brokerage firms raising their price targets. Raymond James, for instance expects AAPL to rally to $152 -- all-time high territory. 
  3. Analysts this morning are also raising their expectations on semiconductor stock Advanced Micro Devices, Inc. (NASDAQ:AMD), after the company announced impressive fourth-quarter revenue, boosting the stock 3.2% in electronic trading. While AMD has cooled since its nine-year high in December, the shares have found solid support in the form of their rising 50-day moving average. 
  4. Better-than-expected quarterly results are also boosting Anthem Inc (NYSE:ANTM) ahead of the open. The stock is up 0.6% in pre-market trading, set to add to its impressive post-election rally. ANTM just yesterday hit an annual high of $154.97, as its proposed buyout of CIGNA Corporation (NYSE:CI) remains up in the air. 
  5. Also due out today are the Markit manufacturing purchasing managers index (PMI), the Institute for Supply Management (ISM) manufacturing index, construction spending, and regularly scheduled crude inventories data. Plus, of course, the Fed's policy announcement will hit the Street at 2 p.m. ET. Reporting earnings will be Allstate (ALL), Altria (MO), Cirrus Logic (CRUS), Edwards Lifesciences (EW), Legg Mason (LM), and Pitney Bowes (PBI).

Buzz Stocks Feb 1

Overseas Trading

Stocks in Asia finished mostly higher as global traders looked ahead to today's Fed policy decision in the U.S. China's Shanghai Composite remained closed for the Lunar New Year holiday, but data showed the country's sixth straight month of expansion in the manufacturing sector -- and a slightly improved service sector index -- which helped boost confidence in the region. Japan's Nikkei added 0.6%, after Mitsubishi Motors soared on the carmaker's upwardly revised full-year forecast, and the yen erased earlier gains against the U.S. dollar. An 11.2% year-over-year jump in January exports helped South Korea's Kospi climb 0.6%. Hong Kong's Hang Seng bucked the bullish trend, though, shedding 0.2%.

European markets are in positive territory at midday, as investors digest a round of corporate earnings and respond to the encouraging data out of China. Auto stocks are among the leading gainers, thanks to a positive earnings reaction for Volvo, while the banking and mining sectors are also seeing a strong session so far. On the economic front, IHS Market PMI data for the eurozone showed manufacturing activity grew at its fastest pace in almost six years last month. At last check, London's FTSE 100 has added 0.6% ahead of tomorrow's Bank of England policy meeting. The German DAX is 1.1% higher, as the euro retreats following Chancellor Angela Merkel's response to President Donald Trump's accusations of currency devaluation. Meanwhile, France's CAC 40 is leading its peers, up 1.3%.

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