(Reuters) – U.S. stocks were on pace to open higher on Thursday, after Britain struck a preliminary last-minute deal with the European Union easing some geopolitical jitters, while upbeat earnings from Netflix and Morgan Stanley affirmed a strong start to the reporting season.
FILE PHOTO: Traders work on the floor at the New York Stock Exchange (NYSE) in New York, U.S., September 12, 2019. REUTERS/Brendan McDermid
British Prime Minister Boris Johnson said “we have a great new Brexit deal,” lifting the mood across global equities, while he is yet to receive approval for the agreement in a vote at a session of the British parliament on Saturday.
“Although, the agreement reached between the U.K. and EU needs to be approved by the British parliament, the headline news coupled with U.S. earnings should boost market sentiment,” said Peter Cardillo, chief market economist at Spartan Capital Securities in a client note.
Netflix Inc (NFLX.O) shares jumped 8% in premarket trading, after the video streaming service provider added slightly more paying subscribers than Wall Street expected in the third quarter.
Morgan Stanley (MS.N) gained 3.6% after the big lender beat analysts’ expectations for quarterly profit, buoyed by higher revenue from bond trading and M&A advisory fees.
This followed upbeat results earlier in the week from major U.S. banks JPMorgan Chase & Co (JPM.N), Citigroup Inc (C.N), Bank of America (BAC.N) and healthcare giants Johnson & Johnson (JNJ.N) and UnitedHealth Group Inc (UNH.N).
“So far so good. Definitely the bank earnings have been terrific, relative to expectations,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
Also supporting sentiment was the Chinese Commerce Ministry saying it hoped to reach a phased agreement in a protracted trade dispute with the United States and cancel tariffs as soon as possible.
Rising uncertainties around the U.S.-China trade war, increasing geopolitical risks and weak domestic economic indicators have recently hit sentiment, with investors now focusing on third-quarter earnings for clarity on these factors impacting Corporate America.
Analysts are expecting S&P 500 third-quarter earnings to fall by 3%, which would mark the first year-on-year contraction since the earnings recession that ended in 2016.
However, of the 43 S&P 500 companies to have posted quarterly results so far, 86% have beaten expectations.
At 8:34 a.m. ET, Dow e-minis 1YMcv1 were up 64 points, or 0.24%. S&P 500 e-minis EScv1 were up 8.25 points, or 0.28% and Nasdaq 100 e-minis NQcv1 were up 30.5 points, or 0.38%.
Among other stocks, International Business Machines Corp (IBM.N) slipped 6% after it missed quarterly revenue estimates due to weakness in its global technology services unit.
Investors also targeted industrial earnings, which have been a mixed bag so far.
Honeywell International Inc (HON.N) cut its full-year sales forecast, as its customers limited spending amid a slowing global economy. Shares of the diversified manufacturer inched 0.3% higher.
Reporting by Shreyashi Sanyal and Medha Singh in Bengaluru; Editing by Bernard Orr
- Wall Street at record levels after Donald Trump signs fiscal aid bill
- Wall Street braces for tougher rules under new Democratic majority
- COVID-19: FTSE 100 suffers worst year since 2008 - but Wall Street rebounds
- Brexhausted! Four Years of Brexit Blunders, Part Three: First Bedlam, Then Betrayal
- Netflix subscribers soar like crazy as coronavirus traps us at home
- The best cheap office chair deals for January 2021
- Yes, Britain CAN spring back! Broadcasting titan ANDREW NEIL gives his uplifting vision of a post-Brexit boom (as long as Boris doesn't mess it up)
- It's here! RAF jet touches down in London with historic Brexit trade deal for Boris Johnson to sign, after beaming EU chiefs do the honours in Brussels - with MPs set to give their seal of approval
- Macron says Brexit is the product of 'lies and false promises' in annual address delivered hours after his father denounced him as a 'self-serving' politician
- Theresa May staggers on after three Brexit defeats in single day
- Brexit is DONE! Britain FINALLY breaks free of EU rules - with Dover lying deserted on the stroke of 11pm amid warnings of queues and shortages ahead
- Military planes to fly Covid vaccines in to Britain to avoid ports hit by Brexit
- Boris Johnson insists he will stay on as Prime Minister after Brexit
- 'The moment is finally upon us… now is the time to seize it': Boris Johnson hails 'new beginning in our country's history' as Queen grants royal assent to his Brexit trade deal meaning divorce happens at 11pm tonight
- Cinema Stocks Decimated, Netflix and Disney Outperform in 2020
- RICHARD KAY: NOW will they stop wailing? They were the insufferable refuseniks horrified by a democratic referendum (because they lost) who battled to thwart it. Now, before we sail into a brave new tomorrow, a fond salute to Brexit's bitter losers
- Alarm bells for Boris as huge poll finds Labour would reclaim Red Wall in an election – and the PM would lose his OWN seat
- Treasury adviser, 27, who was fired by Dominic Cummings for allegedly leaking no-deal Brexit plans claims PM's top aide told armed police to march her out of Downing Street after giving her no reason for sacking
- 34 of the best movies to watch on Netflix
- The 35 best movies to watch on Netflix
Wall Street cheers Brexit deal; Netflix, Morgan Stanley results set positive mood have 878 words, post on feeds.reuters.com at October 17, 2019. This is cached page on Business News. If you want remove this page, please contact us.