Cautious Premarket Wednesday as Earnings, Data Lead Trading

Morning Outlook

Futures are mostly lower Wednesday, another cautious move as analysts digest earnings from J.P. Morgan Chase & Co. (JPM) and Goldman Sachs Group Inc. (GS). It is nice to see the market getting back to a more normal fundamental trade, rather than the risk-on risk-off move since the financial crisis. Consumer prices were in line for December, with the remaining economic data on the day looking at manufacturing and housing. The blue chips will have to stage another red to green move to keep its winning streak alive as futures for the Dow Jones industrials were down 54 points at 13,409. Those for the S&P 500 index lost 3.2 points to 1,462. Nasdaq 100 futures edged up 1 point at 2,715.

Apple Inc. (AAPL) once again weighed down technology and the broader market on Tuesday, however there was enough positive momentum to see a mostly green close. The Dow Jones Industrial Average rose 27.57 points, or 0.2%, to 13,534.89. The S&P 500 Index gained 1.66 points, or 0.1%, to 1,472.34, with telecommunications the biggest laggard and consumer discretionary faring best among its 10 major sectors.The Nasdaq Composite Index shed 6.72 points, or 0.2%, to 3,110.78.

Economic Calendar

9:15 AM
Industrial Production: The index of industrial production measures the physical output of the nation’s factories, mines and utilities. The consensus is for an increase of 0.2% in production for the month of December. Industrial production rebounded 1.1 percent, following a decline of 0.7 percent in October. The range goes from -0.1 % to 0.6% as the Street looks for normalization in the reading post-Sandy. Overall capacity utilization is expected to increase 10 bps to 78.5 after rising 0.7 percentage point to 78.4 percent in November.

10:00AM
Housing Market Index: The National Association of Home Builders produces a housing market index based on a survey in which respondents from this organization are asked to rate the general economy and housing market conditions. The housing market index is a weighted average of separate diffusion indexes: present sales of new homes, sale of new homes expected in the next six months, and traffic of prospective buyers in new homes. The consensus reading for January is 48, after being up a solid two points to 47 for the highest reading in 6-1/2 years and 8 straight months of gains. The range runs from 46 to 50.A reading above 50 indications more positive sentiment than negative from home builders.






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