Stock Futures Signal Record Highs After Senate Passes Budget

Janet Yellen will be in the spotlight today, amid rumors that Trump is leaning toward Powell for Fed Chair

by Patrick Martin

Published on Oct 20, 2017 at 9:19 AM

Dow Jones Industrial Average (DJIA) futures are higher this morning, as the index looks for its sixth straight win and another record high. Markets are shaking off a rough earnings report from General Electric (GE) and poorly received Procter & Gamble (PG) earnings, with stocks pointing higher after the Senate approved a $4 trillion budget measure last night, lifting hopes for tax reform.  

The S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) are both pointed higher as well. Investors will also have their eye trained on Fed Chair Janet Yellen, who will speak later about monetary policy. Yellen is in focus as President Trump considers whether to keep or replace the central bank head, with recent rumors suggesting Trump is leaning toward Fed Governor Jerome Powell.

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


5 Things You Need to Know Today
  1. The Chicago Board Options Exchange (CBOE) saw 1,047,186 call contracts traded on Thursday, compared to 729,656 put contracts. It was the most calls traded since Sept. 15, and the most puts exchanged since Aug. 18. The single-session equity put/call ratio fell to 0.70, while the 21-day moving average rose to 0.66.
  2. Celgene Corporation (NASDAQ:CELG) is down 7.9% in electronic trading, after the company abandoned three Crohn's disease drug trials. Baird downgraded the pharma stock to "neutral" from "buy," and CELG also received no fewer than seven price-target cuts. Despite the stock's recent struggles, CELG stock has added 36% year-over-year, in a channel of higher highs and lows.
  3. Lululemon Athletica Inc. (NASDAQ:LULU) stock is up 2.5% ahead of the bell, after Citigroup upgraded the yoga apparel maker to "buy" from "neutral." Analysts assert that LULU is one of the few retailers built to survive Amazon's aggressive attempts at cornering the market, and lifted their price target on LULU stock to $73 from $62 -- territory not charted since mid-2016. 
  4. Boeing Co (NYSE:BA) made headlines this morning, with the airliner on the verge of finalizing a $13.8 billion jet order from Singapore Airlines. Meanwhile, China Southern will buy 38 Boeing jets worth roughly $5.65 billion. BA stock is up 66% year-to-date, and notched a record high just last week.
  5. Investors will also hear from Cleveland Fed President Loretta Mester today. Procter & Gamble, Cleveland-Cliffs (CLF), Kansas City Southern (KSU), and SunTrust Banks (STI) round out the week's earnings reports.  

stock news october 20

Overseas Trading

The passage of the budget proposal in the U.S. sparked an upside move in Asian equities. Most noteworthy was an incredible 14th straight win from Japan’s Nikkei, which closed up 0.04%, marking its longest winning streak in more than 50 years. Also guiding the index higher was anticipation Prime Minister Shinzo Abe’s coalition will win this weekend’s snap election. Shares of major Chinese companies also rose, despite a warning on asset prices from the governor of the country’s central bank. By the close, the Shanghai Composite was up 0.3%, while the Hang Seng managed a 1.2% win in Hong Kong. Up in South Korea, the Kospi finished with a 0.7% gain. 

European stock indexes are also on the rise. Investors are digesting the latest round of corporate earnings, including upbeat results from Volvo and Ericsson. A number of bank stocks are also among the top performers. London’s FTSE 100 and the German DAX are both up 0.3% so far, while France’s CAC 40 has gained 0.2%. 


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