(Friday Market Open) What a difference a day makes. After a weak early start to the week, equities regained their mojo Thursday, with all 11 sectors solidly in the green. As Friday began, focus turned toward fresh earnings data and mixed markets overseas.
Deere (DE) was in the headlights early Friday after the company reported mixed results, coming in higher than Wall Street analysts had expected on revenue but missing earnings estimates. It was especially interesting to look past the headline numbers, because some of the trends affecting DE might reflect broader economic patterns worth watching.
For instance, DE talked about the high cost of raw materials and employees, with trucking expenses in focus. The company appears to be getting squeezed in these areas. They’re operating in a tough environment, but demand for their products is definitely there, as revenue data showed. DE shares fell 2% in pre-market trading.
Speaking of demand, Nordstrom (JWN) seems to be benefitting from it. The stock was up nearly 9% in pre-market trading after reporting excellent results highlighted by a big increase in online sales and same-store sales that grew 4%, up from analysts
Word of new trade talks with China and solid Wal-Mart earnings seem to have lifted the mood on Wall Street this morning. More retail results due this afternoon.
As earnings season winds down, focus shifts to economic and trade tensions in Turkey and the Pacific Rim.
This morning, U.S. stocks appeared poised for gains, based on equities futures trading before the opening bell, as the Turkish currency gained some footing.
The new week could have a dual focus as investors closely monitor events abroad even as they watch retail earnings start rolling in at home.
The markets seem cautious Friday amid geopolitical concerns. A 13% decline in the Turkish lira this week and continued trade turbulence with China both appear to weigh on stocks.
The failed mergers might be one point of focus Thursday, and investors could also be watching inflation data.
A focus this morning appears to be $16 billion in Chinese goods that will be subject to a 25% U.S. tariff starting later this month.
This morning, investors appear to be focusing on momentum from a generally solid earnings season and letting trade talk simmer on the backburner.
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