- Boeing shares under pressure after reports of a new flaw in the company’s 737 MAX jet fleet
- Investors are digesting conflicting reports on the state of U.S.-China trade negotiations
- Semiconductor stocks seen adding to Wednesday’s rally; Advanced Micro Devices and Nvidia shares rise.
Futures for the Dow Jones Industrial Average turned lower on Thursday amid reports of a new flaw with Boeing Co.’s troubled 737 MAX jet fleet and as investors digested reports that China was setting terms for Sino-American trade negotiations to resume.
Futures for the Dow Jones Industrial Average
were down 12 points, or 0.1%, at 26,535, but had hit a low 26,445, with Boeing Co.’s
shares down by 2% in premarket action, which would translate into a roughly 40-point headwind on the price-weighted blue-chip index. The aeronautics and defense company’s stock had slide by more than 5% in premarket action.
CNN reported that new issues with the Boeing 737 fleet’s computer system had emerged which could delay the aircraft’s’ return to the air after a world-wide grounding back in March. The fleet was grounded after crashes of the Lion Air flight 610 and Ethiopian Airlines flight 302, which killed 346 people.
Futures for the S&P 500 index
traded up 3.85 points, or 0.1%, at 2,921.75 and the Nasdaq-100 futures
rose 17.25 points, or 0.2%, at 7,667.25.
Meanwhile, the Wall Street Journal reported that Chinese President Xi Jinping will present President Donald Trump terms to resolve a market-rattling trade confrontation ahead of an expected meeting at the sidelines of the G-20 gathering of developed countries set to take place in Osaka, Japan, this weekend.
Terms include the removal of a ban on the sale of U.S. technology to Chinese telecommunications giant Huawei Technologies Co., the removal of punitive tariffs, and an end to a request for China to buy additional U.S. exports.
The demands raise some doubts that the two sides can achieve a detente and comes after a report from the South China Morning Post that a tentative U.S.-China truce had been achieved.
Investors will also be watching data on new claims for U.S. unemployment benefits due Thursday at 8:30 a.m. Eastern Time on new claims for unemployment benefits, with economists surveyed by MarketWatch expecting a reading of 216,000. The Commerce Department will issue its final revision of first quarter GDP growth at the same time.
At 10:00 am, the National Association of Realtors will issue its pending home sales index.
Which stocks are in focus?
Occidental Petroleum Corp.
stock could be in focus Wednesday, after investor Carl Icahn called for a special shareholder meeting, where he will seek to replace four directors on the board, arguing that the company’s board should not have approved a $38 billion deal to buy Anadarko Petroleum Corp.
The deal is expected to close in the second half of 2019. Occidental shares were unchanged before the start of trade Thursday.
Shares of Lyft Inc.
rose 1.5%, after news that autonomous vehicle firm Waymo, which is a subsidiary of Google parent Alphabet Inc.
has officially launched a program to make some self-driving minivans available for Lyft customers. The program is only available in a small area outside, Phoenix, Arizona.
Rite Aid Corp.
announced first-quarter financial results Wednesday evening, reporting a larger-than-expected loss and no revenue growth. Shares of the retailer were down 9.7% in off-hours trade. Rival Walgreens Boots Alliance Inc.
meanwhile reported better-than-expected fiscal third-quarter earnings on Thursday morning sending the stock up roughly 1%, before the start of trade.
Fellow retailer Pier 1 Imports Inc.
also reported disappointing earnings after the market close Wednesday. Shares fell 19% before the start of trade Thursday.
Shares of Conagra Brands, Inc.
tumbled 5% in premarket action, after the processed and packaged-foods manufacturer reported worse-than-expected fourth-quarter earnings and sales Thursday morning.
Shares of HealthEquity Inc.
fell 3.9% in premarket trade, after the health savings account (HSA) non-bank custodian, said Thursday it has reached agreement to acquire WageWorks Inc
Semiconductor stocks appear set to add to yesterday’s rally, instigated by upbeat guidance by Micron Technologies Inc.
management. Shares of Advanced Micro Devices Inc
rose 1.6% and Nvidia Corp.
shares added 1% in premarket trade Thursday.
How did other markets trade?
The yield on the 10-year U.S. Treasury note
fell less than a basis point to 2.037%.
In Asia, Japan’s Nikkei 225
jumped 1.2% overnight, while China’s Shanghai Composite Index
fell 0.7%. Hong Kong’s Hang Seng
index rose 1.4%. In Europe, the Stoxx Europe 600 was trading 0.2% lower.
In commodities markets, the price of crude oil
and gold prices
were retreating. The U.S. dollar
was trading flat, as measured by the ICE U.S. Dollar Index at 96.18.
