Stock futures pointed higher as China’s imports and exports shrank less than expected in March while investors brace for earnings season, plus stocks to watch today in the Money & Markets Opening Bell.
The Top Story
Better-than-expected trade data from China pushed futures upward as investors hope some economies are poised to ease lockdowns imposed due to the coronavirus outbreak.
The data showed China’s exports and imports shrank less than expected in March as factories restarted production, but analysts warned a sure-footed recovery is still months away. Chinese exports fell 6.6% in March — better than the 14% economists expected. Imports only fell by 0.9%.
Balancing the positive mood is the beginning of earnings season, which kicks off today as JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Co. (NYSE: WFC) and drugmaker Johnson and Johnson (NYSE: JNJ) are reporting.
Analysts expect a 10.2% slide in first-quarter earnings for S&P 500 firms amid a meltdown in business activity from strict containment measures, according to IBES data from Refinitiv.
“It should come as no surprise that earnings are going to be hit very hard in 2020,” said Fiona O’Neill, deputy head of equities research at Fidelity International. “But it would be wrong to focus too much on 2020. Instead, we must look to forecast where earnings will go in 2021 and beyond so that we can continue to identify those companies that are going to emerge from this as winners.”
The benchmark index has clawed back about 26% in the past month, powered by historic fiscal and monetary support and early signs that the crisis is peaking in some U.S. hot spots. It still remains about 22% below its February all-time high.
As of 9:20 a.m. EDT, Dow Jones futures were up 1.8%. S&P 500 futures moved 1.8% higher while Nasdaq Composite futures were up 2%.
Stocks to Watch Today
Johnson & Johnson (NYSE: JNJ) — The pharmaceutical and packaged goods company beat quarterly profit and revenue forecasts. The company reported a quarterly profit of $2.30 per share but did lower guidance for the rest of the year. Shares of Johnson & Johnson were up 3.5%.
Apple Inc. (Nasdaq: AAPL) — The maker of iPhones saw an increase of 19% in unit shipments from China in March (see more below). The company shipped 2.5 million phones in the month, compared to just 500,000 in February. Shares of Apple were up 1.7%.
Roku Inc. (Nasdaq: ROKU) — Shares of the digital media player company jumped 14% in premarket trading after beating Wall Street sales estimates. The company did pull its full-year 2020 financial outlook due to the COVID-19 pandemic.
Missed Mortgage Payments Jump Due to Pandemic
Approximately 3.74% of home loans in the U.S. are in forbearance — a number that is only expected to go up as more Americans lose their jobs due to the COVID-19 pandemic.
Only 2.73% of loans were in forbearance the week prior.
According to data from the Mortgage Bankers Association, around 2 million homeowners are putting off paying their monthly mortgage payments.
Tesla Inc. Eyeing Rent Savings
As global auto sales remain sluggish, Tesla Inc. (Nasdaq: TSLA) is looking for some relief from its landlords.
In an email obtained by The Wall Street Journal, Tesla told its landlords “we will be reducing out month rent obligations effective immediately.” This impacts space for its stores and service centers across the country.
iPhone China Shipments Rebound as Manufacturing Resumes
After a sluggish start to the year, Apple Inc. (Nasdaq: AAPL) sales in China have started to climb back to normal levels.
According to Bloomberg, shipments of Apple’s iPhone jumped 19% in March from a year earlier as the broader Chinese smartphone market shrank by 22%.
Foxconn, who runs Apple’s assembly plants in China, has had more than 200,000 workers return to production in Zhengzhou, shipping nearly 300,000 iPhones per day.
What We’re Reading
3 Small-Cap Stocks to Buy in 2020 — Finding Profits in a Volatile Market (Money & Markets)
China is Giving Cash to Car Buyers to Revive Sales Crushed by COVID-19 (CNN Business)
O’Dell: Gold Shines as Stocks Slump (Money & Markets)
Earnings Report
Here are the companies releasing earnings reports today:
Commerce Bancshares Inc. (Nasdaq: CBSH)
JB Hunt Transport Services Inc. (Nasdaq: JBHT)
Johnson & Johnson (NYSE: JNJ)
JPMorgan Chase & Co. (NYSE: JPM)
Wells Fargo & Co. (NYSE: WFC)
Check back each morning before the opening bell for stocks to watch today with Opening Bell, here on Money & Markets.
