Stock Futures Lose Steam as Powell Enthusiasm Wears Off

U.S. and China leaders will talk trade at this weekend's G-20 summit

by Patrick Martin

Published on Nov 29, 2018 at 9:13 AM
Updated on Nov 29, 2018 at 9:18 AM

Dow Jones Industrial Average (DJIA) futures are signaling a pullback, after the index enjoyed its best session since March yesterday. The optimism generated from Fed Chair Jerome Powell's dovish comments on interest rates has seemingly worn off, replaced by tension ahead of this weekend's G-20 summit, where U.S. and Chinese leaders are expected to hold trade talks. 

S&P 500 Index (SPX) and Nasdaq-100 Index (NDX) futures are in the red as well, as investors digest a slew of early data. Weekly jobless claims rose to their highest point since mid-May, October consumer spending rose 0.6% -- its biggest increase in seven months -- and the Fed-watched core personal consumption expenditures (PCE) index increased 1.8% year-over-year last month, marking the lowest reading in eight months. Elsewhere, oil prices are on the rebound after falling to a new annual low yesterday, with January-dated crude up 1.4% at $50.98 per barrel, at last check. 

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

  • This airline stock could soar into the New Year.
  • The penny stock that more than doubled yesterday.
  • Options bears take aim at Workday stock ahead of earnings.
  • Plus, McDonald's gets a big upgrade; Micron talks tariffs; and Dollar Tree suffers a same-store sales miss.

Stock Futures Chart Nov 29

5 Things You Need to Know Today

  1. The Chicago Board Options Exchange (CBOE) saw 958,428 call contracts traded on Wednesday, compared to 593,364 put contracts. The single-session equity put/call ratio fell to 0.62, and the 21-day moving average remained at 0.70.
  2. McDonald's Corp (NYSE:MCD) stock is up 1.4% in electronic trading, after Morgan Stanley upgraded the fast food giant to "overweight" from "equal weight," while boosting its price target to $210 from $173. The analyst in coverage waxed optimistic on the company's store modernization efforts. MCD is set to open at a fresh record high, but already boasts a 6% gain in November, a historically bullish month.
  3. Micron Technology, Inc. (NASDAQ:MU) stock is down 0.8% ahead of the bell, even after the chipmaker's CEO said fiscal first-quarter earnings would come in at the high end of guidance. He also said the company is attempting to mitigate the impact of the U.S.-China trade war on gross margins. MU has received two price-target cuts as a result, including to $54 from $60 at Mizuho. The shares have seen their 30-day moving average act as stiff resistance since their late-May peak.
  4. Shares of Dollar Tree, Inc. (NASDAQ:DLTR) are down 4.8% in electronic trading, after the discount retailer reported a third-quarter earnings beat, but saw revenue and same-store sales miss expectations. The company also issued lackluster current-quarter guidance. DLTR is set to open near its Oct. 11 annual low of $78.78, and as of yesterday's close had shed 22% in 2018.
  5. The pending home sales index, the Fed meeting minutes, and the Fed's balance sheet are all due out today. Cleveland Fed President Loretta Mester and Chicago Fed President Charles Evans will speak in the afternoon. Abercrombie & Fitch (ANF), AeroVironment (AVAV), Ambarella (AMBA), GameStop (GME), VMware (VMW), Workday (WDAY), Yeti (YETI), and Yext (YEXT) step into the earnings confessional.  

buzz stocks nov 29

Asian, European Stocks Boosted By U.S. Equities' Big Day

It was a mixed finish in Asia today, with stocks in Tokyo and Seoul taking their bullish cues from the U.S. stock market. Specifically, Japan's Nikkei tacked on 0.4% to bring its daily win streak to five, and South Korea's Kospi gained 0.3%. China's Shanghai Composite and Hong Kong's Hang Seng erased early losses to settle down 1.3% and 0.9%, respectively.

European markets are trading higher at midday, boosted by Powell's dovish tone. At last check, London's FTSE 100 is up 0.6%, the French CAC 40 is 0.4% higher, and the German DAX is sporting a 0.08% gain.

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