After a shaky session yesterday, US markets look set to open lower today as markets kick into gear on numerous corporate earnings releases and consumer confidence data.
Futures suggest the Dow Jones will open 19 points lower at 16,963 with the S&P 500 expected to open 3 points lower at 1,975 and the Nasdaq 100 6 points lower at 3,961.
With no earnings for US blue-chips yesterday, the Dow staged a late recovery and again closed above 16,950 in what was an unsteady session on mixed economic data. If the benchmark is to break its high at 17,150 in the near term, the first release for second quarter GDP on Wednesday is likely to be a key driver given the way the poor number from the first quarter was written off as weather-related.
The largest cap stocks have underperformed broader indices in the past few sessions; whether this trend continues will in part depend on earnings before the open from pharma giants Merck and Pfizer.
The pharmaceutical sector has added to bullish sentiment in markets with a wave of M&A that saw AbbVie successfully takeover Ireland’s Shire. Repositioning in the face of competition from generic drugs as patents run out have seen most of the big pharma companies swap assets to concentrate on more profitable lines of the business.
Pfizer failed in their attempted bid for AstraZeneca; it is expected to report earnings of 57c per share on revenue of $12.46bn.
Merck & Co is expected to earn 81c per share on revenue of $10.6bn.
Herbalife (NYSE:HLF) will be a focus again on the open, the company rallied after hedge fund manager Bill Ackman’s unconvincing presentation on the company’s purported pyramid scheme but has collapsed again afterhours after reporting a drop in quarterly profits.
After today’s close Twitter (NYSE:TWTR) have a lot of naysayers to disprove after last quarters disappointing user growth figures; it is expected to lose -1c per share on revenue of $283m.
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