U.S. stock futures climbed Thursday after the major averages posted back-to-back winning sessions. Investors weighed the latest batch of corporate earnings. Key semiconductor stocks slid in extended trading.
They lost roughly 5%, 4%, and 29% after reporting their latest quarterly results. Ford fell nearly 5% after the automaker issued disappointing earnings and revenue guidance. Honeywell shares were also down more than 4% after the company issued full-year earnings guidance that fell short of analysts’ expectations.
The moves followed a second day of gains for the major stock averages. The Dow Jones Industrial Average added 317.24 points, or 0.71%, during the day’s regular session. The S&P 500 gained 0.39% and the Nasdaq Composite rose 0.19%.
A jump in certain technology stocks aided the gains. Investors seemed to shake off worries around tariffs. The concerns began on Monday after President Donald Trump announced a 10% levy on Chinese imports over the weekend.
Sentiment improved after the president paused duties on Mexican and Canadian goods. “I think the market is coming around to a view I have, which is that this too shall pass,” said Ed Yardeni, president of Yardeni Research. “The market increasingly is focusing on what’s important, and that is earnings.
The earnings outlook is, I think, extremely good.”
Big companies set to report on Thursday include several top corporations. Traders will also watch out for the latest weekly jobless claims. Honeywell shares fell more than 4% in premarket trading.
The industrial giant issued lighter-than-anticipated earnings and revenue guidance. The company expected earnings per share in a range of $10.10 to $10.50. Analysts polled by FactSet anticipated a forecast around $10.92 per share.
Honeywell projected revenue ranging between $39.6 billion and $40.6 billion.
Stock futures maintain upward trend
Analysts expected guidance of $41.26 billion.
European stock markets were broadly higher in early deals Thursday. The FTSE 100 climbed 0.68% as sentiment continued to rebuild following the tariff-sparked sell-off on Monday. The U.K.’s leading index was up 1% at 8:45 a.m. in London.
The pound dropped 0.45% against the U.S. dollar. Traders geared up for an interest rate announcement and forecasts from the Bank of England. The central bank is expected to raise rates by a quarter-point.
Attention will be on policymakers’ communications on inflationary pressures and the U.K. growth outlook. Yields on U.K. government bonds were slightly higher. They have cooled significantly following a spike last month.
The yield on the benchmark 10-year bond was up two basis points at 4.162%. Stocks in China and the renminbi face “a tough year regardless of how trade tensions play out,” according to Thomas Mathews, head of Asia Pacific markets at Capital Economics. Higher tariffs, or even if elevated tariffs remain, leave plenty of room for “China’s markets to deteriorate,” according to the firm, a London-based researcher.
“But tariffs are, in our view, only one reason to be downbeat,” Mathews wrote Wednesday. He added that China’s tepid economy ought to keep down bond yields. The central bank is more likely “to let the currency weaken.” Meanwhile, stock market investors may be too optimistic about the effect of government measures to boost the economy.
They may also be too confident about the ability of companies in China to “generate sustained growth in earnings per share.”
These are the stocks moving the most in extended trading hours:
Qualcomm: The semiconductor stock slipped close to 5% despite reporting strong earnings. Ford Motor: Shares tumbled 5% after the automaker issued disappointing guidance. Other semiconductor companies: Shares shed almost 5% despite posting earnings and revenue beats.
Stock futures traded near flat Wednesday night. S&P 500 futures slipped just under 0.1% shortly after 6 p.m. ET. Nasdaq 100 and Dow Jones futures were both trading around the flatline.
