Dow futures are pointing to a modestly higher open as traders digest mixed data
After marking its first
back-to-back losses since January, the
Dow Jones Industrial Average (DJIA) appears set to open modestly higher, with futures trading above fair value. Boosting stocks this morning is ADP's monthly report on private-sector employment, which blew past expectations, showing 298,000 jobs added in February compared to a prediction of 190,000. But gains are being kept in check with Friday's nonfarm payrolls report on tap, as upbeat jobs data only strengthens the case for an interest rate hike at next week's Fed meeting.
Meanwhile, the
S&P 500 Index (SPX) and
Nasdaq Composite (COMP) are lagging the Dow, on pace to open in the red. Lower oil prices could weigh on the market today, with April-dated crude futures down 1.3% at $52.53 per barrel -- a one-month low -- after the American Petroleum Institute reported a larger-than-expected rise in U.S. inventories.
Continue reading for more on today's market, including:
- Schaeffer's Senior Quantitative Analyst Rocky White sizes up the current market rally against history's longest bull markets.
- These 2 drug stocks could be flashing "buy" signs for options traders.
- What option activity is saying about investor sentiment toward mid-cap stocks, according to Schaeffer's founder and CEO Bernie Schaeffer.
- Plus, a blue-chip stock under fire, Express eyes record lows, and an earnings beat has one retailer ready to pop.
Futures on the Dow Jones Industrial Average (DJIA) are 10 points above fair value.
5 Things You Need to Know Today
- The Chicago Board Options Exchange (CBOE) saw 869,076 call contracts traded on Tuesday, compared to 468,457 put contracts. The resultant single-session equity put/call ratio fell to 0.54, while the 21-day moving average stayed put at 0.63.
- Dow component Caterpillar Inc. (NYSE:CAT) is in the spotlight after a New York Times report said the company is being accused of tax and accounting fraud, though no charges have yet been filed. CAT shares are off 1.9% in electronic trading.
- A disappointing current-quarter outlook is overshadowing in-line earnings for apparel retailer Express, Inc. (NYSE:EXPR), which is on pace to open at a record low, down 12% ahead of the bell. This looks to be a repeat of history for the stock, which has cratered after recent quarterly earnings -- but short sellers aren't likely to mind.
- In contrast, retail stock Children's Place Inc (NASDAQ:PLCE) is 7.1% higher ahead of the open after easily beating earnings expectations and announcing a $250 million share repurchase program, as well as an increase to its quarterly dividend. Should short sellers abandon their positions, the stock could be ready to make a fresh run at record highs.
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The weekly crude inventory report from the Energy Information Administration (EIA) will be released later today. On the earnings front, Bob Evans (BOBE), Ciena (CIEN), Sunrun (RUN), Tailored Brands (TLRD), and United Natural Foods (UNFI) will report quarterly figures.
Overseas Trading
Asian markets ended mixed, amid mounting tensions between China and South Korea, as well as rising expectations the Fed will hike interest rates next week. The biggest winner was Hong Kong's Hang Seng, jumping 0.4%, while South Korea's Kospi edged up nearly 0.1%, even after Beijing criticized U.S. deployment of an anti-missile system near Seoul -- which has been followed by reported cyberattacks and boycotts against South Korean businesses. Meanwhile, China's Shanghai Composite settled just below breakeven, following the country's first trade deficit since February 2014. Japan's Nikkei stepped back, as well, dropping 0.5% for a fourth consecutive loss, despite an upwardly revised gross domestic product (GDP) reading.
Stocks in Europe are up and down at midday, as investors review the latest round of economic data and corporate earnings. On the plus side of the ledger is the German DAX, up 0.1%, led higher by shares of Adidas after the apparel maker's earnings report. Traders are likewise cheering a sharper-than-expected rebound in January industrial production, after a December slump. Meanwhile, London's FTSE 100 is 0.2% lower, as Britain's finance minister lays out the newest spring budget -- and the last before the U.K. begins Brexit talks with the European Union (EU) -- which included downward revisions to the 2019 and 2020 growth forecasts. Also down 0.2% is France's CAC 40, as presidential candidate Francois Fillon battles new allegations of an undeclared $53,000 loan.
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