US Stock Futures Waver as Heavyweight Earnings Disappoint
US stock index futures exhibit minimal fluctuations, partially offsetting early gains fueled by Treasury Secretary Scott Bessent's remarks on the Trump administration's efforts to reduce 10-year Treasury yields. The Nasdaq 100 futures experience a slight decline of 0.1%.
Notable earnings reports drive market sentiment. Qualcomm, a global leader in smartphone processors, plummets over 5% on concerns of cooling demand for the devices. Ford's stock price falls 6% following warnings of US tariff impacts on carmaker profitability. Skyworks Solutions Inc., an Apple Inc. chip supplier, plunges more than 20% amid escalating industry competition. Apple shares also exhibit a decrease.
Honeywell International Inc. announces plans to separate into publicly traded entities, resulting in a stock price decline of over 5%. Bessent emphasizes in an interview that the Federal Reserve remains the sole topic of his discussions, excluding future expectations. He reiterates his stance that expanded energy supply contributes to inflation reduction.
However, investors express skepticism towards significant reductions in 10-year yields due to persistent price pressures and a robust economy hindering expectations of additional Fed easing measures. The 10-year Treasury yield increases approximately two basis points on Thursday, hovering near a one-month low.
"Significant declines in the 10-year yield appear unlikely without a substantial economic slowdown," suggests David Zahn, Franklin Templeton Investment Management's senior vice president. "If that occurs, despite being undesirable, it could trigger a further drop in 10-year yields."
Upcoming earnings reports include Amazon.com Inc., scheduled to release results after market closure. European markets, represented by the Stoxx 600 benchmark, surge towards a record close. Positive earnings reports boost Societe Generale SA and AstraZeneca Plc. A.P. Moller-Maersk A/S gains nearly 9% after announcing a $2 billion buyback.
UK markets outperform, while the pound depreciates, following the Bank of England's interest rate cut, as anticipated. Traders anticipate further easing actions.
Economic indicators include a surge in German factory orders in December, indicating potential improvement in the industry's prospects. US jobless claims data will also garner attention, with the payrolls report scheduled for release on Friday.