Tech Stocks Eye Rally After Netflix Earnings

Meanwhile, the release of the latest Fed meeting minutes will be in focus this afternoon

Josh Selway
Oct 17, 2018 at 9:10 AM
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U.S. stock futures are pointing toward a mixed open this morning. The Dow Jones Industrial Average (DJIA) looks set for a meaningful pullback after yesterday's massive rally, with Dow component IBM (IBM) down pre-market after earnings. On the other hand, Nasdaq-100 (NDX) futures are comfortably above fair value, thanks to impressive Netflix (NFLX) earnings. The market is also anxiously awaiting the release of the latest Fed meeting minutes later today, which could shift the focus back to rising interest rates.

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

  • Data from Schaeffer's Senior Quantitative Analyst Rocky White shows why small-cap stocks have the advantage right now.
  • A social media stock bulls can target.
  • Options traders reacted quick to the Twilio stock sell-off.
  • Plus, NFLX shares rise; IBM's post-earnings move; and a semiconductor stock set to surge.

us stock futures oct 17

5 Things You Need to Know Today

  1. The Chicago Board Options Exchange (CBOE) saw 931,375 call contracts traded on Tuesday, compared to 583,267 put contracts. The single-session equity put/call ratio moved up to 0.63, and the 21-day moving average remained at 0.62.
  2. NFLX shares are set to open up 11.3%, thanks to impressive third-quarter earnings and strong subscriber growth. While a number of analysts responded favorably with price-target hikes, KeyBanc joined a recent chorus of Netflix bears, downgrading the stock to "sector weight" from "overweight."
  3. Meanwhile, IBM stock is trading down 4.7% before the open, due to weak third-quarter revenue. This was followed up by price-target cuts to $164 and $168 at BMO and Morgan Stanley, respectively. Most analysts are already bearish on the blue chip, though UBS recently weighed in bullishly.
  4. Another big pre-market mover is semiconductor stock Vicor Corp (NASDAQ:VICR), as it's set to jump 21.6% after impressive third-quarter results. The shares had been struggling since peaking at $64.50 in August, closing Tuesday at $38.37, due in part to broader headwinds in the chip sector. Still, VICR stock was trading down near $21 coming into 2018.
  5. Housing starts and the weekly crude inventories report will come out, too. As for corporate earnings, Alcoa (AA), Steel Dynamics (STLD), United Rentals (URI), and U.S. Bancorp (USB) will report.

stock market news oct 17

Asian Markets Rise After U.S. Rally

Asian markets followed Wall Street’s Tuesday lead, and closed higher in today’s session. Japan’s Nikkei picked up 1.3% with a push from tech, specifically SoftBank, after Chief Operating Officer Marcelo Claure said the company – which has ties to Saudi Arabia – is still performing "business as usual" despite the disappearance of a U.S. journalist. Meanwhile, South Korea’s Kospi closed 1% higher, China’s Shanghai Composite added 0.6%, and markets in Hong Kong were closed for holiday.

Stocks in Europe are mixed at midday, as investors digest a tame consumer inflation reading out of the U.K. and gear up for Brexit talks scheduled for later this afternoon in Belgium. Disappointing European auto sales have car stocks weighing heavy, and at last check, London’s FTSE 100 is 0.3% higher, while Germany’s DAX is down 0.4%, and France’s CAC 40 is 0.2% lower.


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