Stock futures advance after JPMorgan results, data on tap
U.S. stock index futures advanced on Friday, indicating the S&P 500 may crimp its worst weekly decline since early June, following a robust earnings report from JP Morgan and ahead of data on consumer confidence and inflation.
JPMorgan Chase & Co rose 1.4 percent to $42.68 in premarket trading after reporting a 34 percent jump in third-quarter profits as the largest U.S. bank made more home mortgage loans.
But Wells Fargo & Co lost 1.8 percent to $34.55 in premarket trading after reporting its third-quarter results.
The earnings of both banks will be scrutinized for insight on the health of the financial sector and the economy as a whole. Both had been forecast to benefit significantly from a home loan refinancing boom.
"The banks are a huge part of what is going on - they have been trading below tangible book value, which means people don't believe what is on their books, so any time we get information on them, that could be a driver for the market," said Kim Forrest, senior equity research analyst, Fort Pitt Capital Group in Pittsburgh.
"So people are going to be analyzing the results from JP Morgan and trying to figure out if things in the economy are getting better or staying the same."
The benchmark S&P index has shed 1.9 percent so far this week, putting it on track for its worse weekly performance since a 3-percent drop in the week through June 3.
Weak global demand has heightened investor worry over the corporate earnings season. As a group, S&P 500 companies' third-quarter earnings are expected to fall 3 percent from a year ago, according to Thomson Reuters data, marking the first decline in three years.
Economic data is due, in the form of the September producer price index at 8:30 a.m. EDT (1230 GMT) and the Thomson Reuters/University of Michigan Surveys of Consumers preliminary consumer sentiment index for October at 9:55 a.m. (1355 ET).
Producer prices are expected to show a 0.7 percent rise compared with a 1.7 percent rise in August. Economists in a Reuters survey expect a consumer sentiment reading of 78.0 compared with 78.3 in the final September report.
Investors will eye the PPI data for any signs of inflation while consumer sentiment will be monitored for indications recent labor market data helped boost views on the economy.
S&P 500 futures rose 3.7 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 24 points, and Nasdaq 100 futures added 3.5 points.
Advanced Micro Devices Inc dropped 8.1 percent to $2.94 in premarket trading after the chipmaker said its third-quarter revenue likely fell 10 percent from the previous quarter as a weak global economy and a growing preference for tablets slams the PC industry.
European shares fell and looked set to end the week in negative territory but analysts said the market was not likely to witness a sharp sell-off.
Asian stocks steadied, but were on course for a losing week as worries about weak corporate earnings and slowing global economic growth limit the appeal of riskier assets.
(Editing by Bernadette Baum)