Pandemic Turns Grimmer, Intel and IBM Disappoint; EIA Data - What's up in Markets

Pandemic Turns Grimmer, Intel and IBM Disappoint; EIA Data - What's up in Markets

Investing.com  | Jan 22, 2021 19:50

Pandemic Turns Grimmer, Intel and IBM Disappoint; EIA Data - What's up in Markets

By Geoffrey Smith 

Investing.com -- News flow from the pandemic took a turn for the worse, as President Joe Biden warned of another 100,000 deaths within the next month, while Tokyo faced up to fears it may have to cancel the rescheduled summer Olympics. PMIs in Europe also ticked down and government deficits ticked up. Stocks are set to open lower, with doubts about the outlook for Intel and IBM not helping. Here’s what you need to know in financial markets on Friday, January 22nd.

1. Pandemic news turns grimmer

The news flow around the pandemic took a darker turn around much of the world. President Joe Biden said the U.S. death toll from Covid-19 could top 500,000 in the next month, while Germany’s topped 50,000.

U.K. Prime Minister Boris Johnson warned that the current lockdown could last until summer and Japan’s government was forced to deny reports that it will be forced to cancel the summer Olympic Games, which were already rescheduled once last year.

That all weighed on global stocks, pushing the Euro Stoxx 50 down 1.2% and the Nikkei 225 down 0.4%, while Chinese indices also lost ground. The dollar rebounded as the risk appetite that has characterized the rest of the week moderated. Bitcoin lost another 10% before recovering a little

2. Intel, IBM reports raise questions

Intel  (NASDAQ:INTC) stock is set to give up most of the gains it made in late trading on Thursday after an unauthorized early release of its quarterly earnings.

Sales and profit both outstripped expectations but the market reacted coolly to plans to do more licensing deals with rivals such as Samsung (OTC:SSNLF) and Taiwan Semiconductor Manufacturing (NYSE:TSM).

IBM (NYSE:IBM) stock is also set for a rough ride when the market opens after it pushed back – yet again – its timeline for a sustained return to revenue growth. The company’s acquisition of Red Hat had solved the problem in the short term last year, but fourth-quarter revenue missed estimates again, suggesting that its move to the cloud is still dragging.

3. Stocks set to open lower

U.S. stocks are set to open lower later, on a combination of the pandemic news and the downbeat news from Tech’s Old Guard late on Thursday.

By 6:40 AM ET, Dow Jones Futures were down 275 points, or 0.9%, while S&P 500 Futures were down 0.8% and NASDAQ Futures were down 0.6%.

The day’s earnings calendar is relatively light, with oilfield services group Schlumberger the only release of note. On the data front, there will be data on existing home sales for December, which come against the backdrop of another extremely strong set of numbers on Thursday for both housing starts and building permits. Lumber Futures, which had been under pressure in recent days, rebounded 6.9% on the news.

4. Europe PMIs fall, U.K. economy struggles

The Eurozone economy fell deeper into contraction territory at the start of the year, according to purchasing managers indices released by IHS Markit.

The Composite PMI for the Eurozone fell to 47.5 from 49.1, against a backdrop of restrictions on social life and economic activity that have been successively tightened as new strains of the virus have been discovered.

U.K. retail sales for December were also well below expectations, and November’s figures were also revised down. The U.K. government set a new record for borrowing in December, as the pandemic drove up the public spending bill. The U.K. services PMI fell to its lowest since June.

5 Oil slips on Covid concerns; EIA, Baker Hughes data due

Crude oil prices also fell on the same pandemic concerns.

By 6:40 AM ET, U.S. Crude futures were down 2.5% at $51.83 a barrel, while the international benchmark Brent was down 2.3% at $54.84 a barrel.

The U.S. government will release its estimate of weekly oil inventories at 1030 AM ET, two days later than normal due to Monday’s holiday and Wednesday’s inauguration.

Baker Hughes’ drilling report and the CFTC data on net speculative positioning in futures will round off the week.

 

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (UK) English (India) English (Canada) English (Australia) English (South Africa) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Polski Português (Portugal) Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.