Futures lower ahead of GDP data
Economists expect the economy rebounded in 1Q compared to the previous quarter and grew at a 3.1% rate.
U.S. equity futures were lower in early premarket trade ahead of the key U.S. first quarter GDP report due out at 8:30 a.m. ET. Economists surveyed by Bloomberg are expecting a GDP growth rate of 3.1% in the first quarter with estimates ranging between 2.3%-3.3%. This would be a staunch improvement from the fourth quarter's 0.4% growth.
In other news, the Bank of Japan released its updated economic forecasts at its interest rate meeting overnight. The BoJ is estimating a 2.9% growth for fiscal year 2013 and 2014 vs. 2.3% previously. It also sees inflation reaching 1.9% by 2015 or 2016.
The China MNI Business Sentiment index rose to 58.6 in April from 58.2 in March, indicating that businesses and managers are still rather optimistic about the Chinese economy despite recent weak data.
Archer Daniels Midland (ADM) increased its bid for Australian company Graincorp to $4.3 billion, making the deal a near certainty according to analysts.
S&P 500 futures slid 5.5 points to 1,576.20.
The EUR/USD was flat at 1.3011.
Spanish 10-year government bond yields rose 5 basis points to 4.34%.
Italian 10-year government bond yields rose 7 basis points to 4.13%.
Gold rose 0.03% to $1,462.50 per ounce, retracing nearly 50% of its losses since its recent slide from above $1,600 per ounce to below $1,400.
Asian shares were mostly lower overnight on disappointing forecasts from the Bank of Japan as well as on no increase in its easing policy. Inflation data, meanwhile, showed that policy in Japan has had no impact as of yet. The Japanese Nikkei Index fell 0.3% and the Shanghai Composite Index fell 0.97% while the Hang Seng Index rose 0.65%. Also, the Korean Kospi fell 0.36% while Australian shares declined 0.1%.
European shares gave back gains from earlier this week, but peripheral shares were still up more than 4% on the week. The Spanish Ibex Index fell 0.94% while the Italian FTSE MIB Index fell 0.71%. Meanwhile, the German DAX slid 0.63% while the French CAC 40 declined 1.12% and U.K. shares fell 0.56%.
Commodities were mostly weaker overnight, giving back strong gains from earlier this week, driven by the weaker than expected Japanese inflation data. WTI crude futures fell 0.83% to $92.86 per barrel and Brent crude futures fell 0.62% to $102.77 per barrel. Copper futures fell 0.57% to $322.40 after seeing a nice run this week from recent lows. Gold was slightly higher and silver futures declined 0.34% to $24.10.
Currency markets were rather quiet overnight save for yen crosses as the yen strengthened on the back of the Bank of Japan disappointment. The EUR/USD was flat at 1.3011 and the dollar fell 0.59% against the yen to 98.67. Overall, the Dollar Index fell 0.07% on weakness against the yen, the Swiss franc and the pound.
Earnings reported Thursday
Key companies that reported earnings Thursday include:
Amazon.com (AMZN) reported first quarter earnings per share of $0.18 vs. $0.09 on revenue of $16.07 billion vs. $16.16 billion expected. However, second quarter guidance was slightly weaker than expected.
Biogen Idec (BIIB) reported first quarter earnings per share of $1.97 vs. $1.59 on revenue of $1.4 billion vs. $1.41 billion expected.
Colgate-Palmolive (CL) reported in-line earnings per share of $1.32 on revenue of $4.32 billion vs. $4.3 billion expected.
Expedia (EXPE) reported first quarter earnings per share of $0.25 vs. $0.23 on revenue of $1.01 billion vs. $967.4 million estimate.
Lear Corp. (LEA) reported first quarter earnings per share of $1.30 vs. $1.09 on revenue of $3.95 billion vs. $3.68 billion expected.
3M (MMM) reported first quarter earnings per share of $1.61 vs. $1.66 on revenue of $7.63 billion vs. $7.81 billion expected.
Potash (POT) reported first quarter earnings per share of $0.63 vs. $0.61 on revenue of $2.1 billion vs. $1.85 billion expected.
Starbucks (SBUX) reported in-line second quarter earnings per share of $0.48 on revenue of $3.56 billion vs. $3.58 billion expected.
Exxon Mobil (XOM) reported first quarter earnings per share of $2.12 vs. $2.05 expected on revenue of $108.8 billion vs. $119.83 billion expected.
Stocks moving in the premarket included:
J.C. Penney (JCP) rose 7.15% premarket after George Soros reported a 7.9% stake in the company despite another executive leaving the company.
Amazon.com (AMZN) shares declined 3.2% premarket following the weaker than expected guidance.
Expedia (EXPE) shares declined 5.34% premarket after reporting better than expected earnings.
Archer Daniels Midland (ADM) shares declined 0.36% after the company boosted its bid for Australia's Graincorp to $4.3 billion.
Notable companies expected to report earnings Friday include:
Chevron (CVX) is expected to report first quarter earnings per share of $3.06 vs. $3.17 a year ago.
D.R. Horton (DHI) is expected to report first quarter earnings per share of $0.19 vs. $0.13 a year ago.
V.F. Corp. (VFC) is expected to report first quarter earnings per share of $2.18 vs. $1.94 a year ago.
Weyerhaeuser (WY) is expected to report first quarter earnings per share of $0.22 vs. $0.02 a year ago.
On the economics calendar Friday, the first look at U.S. first quarter GDP is expected as well as consumer sentiment data later.
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John Stumpf acknowledges that growth has been slow, but he says he's still optimistic.
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