- U.S. equity futures climbed Friday.
- Chinese education companies plunged n U.S. pre-market trading, on fears of a Chinese government crackdown on the for-profit education sector.
- Twitter jumps in U.S. pre-market trading.
- Treasury yields rise
(July 23) U.S. equity futures climbed Friday amid earnings optimism that’s pushing global stocks back toward all-time highs despite mixed economic data and concern about the spread of coronavirus variants.
At 7:48 a.m. ET, Dow E-minis were up 162 points, or 0.47%, S&P 500 E-minis were up 18 points, or 0.41% and Nasdaq 100 E-minis rose 47 points, or 0.31%.
Strong earnings have helped the market heal fromMonday's pandemic-inspired meltdown, with investors looking at the fundamentals rather than surging coronavirus numbers.
Among individual stocks, Snap leapt 16% in premarket trading on revenue that more than doubled in the second quarter and thefastest user growth in four years.American Expressgained over 4% on forecast-beating earnings and revenue as spending accelerated in the three months through June.
Twitter shares rose over 4% in premarket trading after thesocial-media companyreported a 74% increase in revenue in the second quarter compared with a year before.Intel’sstock fell 2.5% after Chief Executive Pat Gelsinger said he sees theglobal semiconductor shortagepotentially stretching into 2023.
Of the roughly 110 companies in the S&P 500 that had posted results through Thursday for the second quarter, 85% topped analysts’ profit forecasts, according to FactSet.
TAL Education Groupshares, listed in New York, plunged 58% premarket on fears of a Chinese government crackdown on the for-profit education sector, and after-school tutoring in particular. An unverified document, circulating among investors and seen by The Wall Street Journal, appeared to be an official communication detailing tougher guidelines. Analysts at Jefferies say investors have grown worried about the outlook for after-school tutoring, and are concerned it may have to be done on a nonprofit basis.
Other Chinese education companies also took a hit. American depositary receipts of Beijing-based17 Education & Technology Group slumped 40% premarket.
Survey data on the manufacturing and service sectors, due at 9:45 a.m. ET, will offer fresh cues on theoutlook for the economy. Economists say the U.S.’s growth spurt likely peaked in the spring, but still expect a strong expansion to continue into 2022.
In the bond market, theyield on 10-year Treasury notesticked up to 1.297% from 1.264% Thursday. Yields move in the opposite direction to bond prices.
“This was always going to be a difficult moment when we move from that [economic] rebound to normal rates of growth,” said Paul Jackson, head of asset allocation research at Invesco. “So I suspect the markets will continue to trend higher, but we will get these little pockets of volatility.
Oil prices wavered between small gains and losses. Futures for West Texas Intermediate, the main grade of U.S. crude, were roughly flat at $71.87 a barrel, putting themon track for a muted weekly gain.