US stocks are set to open lower on Tuesday as caution takes hold over retail sales in March and first quarter earnings from banking giants JP Morgan Chase and Wells Fargo (NYSE:WFC), as well as Dow component, Johnson & Johnson (NYSE:JNJ).
Stocks lost ground on Monday, pulling away from key price levels, after strong gains the week prior. The sole sector to end positively were financials, leading into a week packed full of bank earnings. Major money-centre banks are, on the whole, expected to show some improvement after several dismal quarters mired in regulatory fines.
On Tuesday JP Morgan Chase and Wells Fargo report before the opening bell while Intel (NASDAQ:INTC) and CSX Corporation (NYSE:CSX) reporting after the close.
US retail sales are expected to grow 1.1% in March, a big improvement on the -0.6% seen in February. It’s worth considering that retail sales have been expected to pick up for the last three months and it hasn’t happened. A massive drop in prices at the pump, as well as unemployment below 6% is supposed to translate to consumer spending. So far, it’s only consumer confidence that’s on the rise.
Arguably the weak jobs numbers and subsequent rally in stocks and the Dollar would suggest that even another month of retail sales declines won’t deter the bulls. Fed speakers have remained confident about a 2015 rate hike despite disappointing data, so New York Fed President Dudley speaking today could be significant. Producer price inflation data is reported at 1.30pm BST.
Futures suggest the:
S&P 500 will open 4 points lower at 2,088 with the
Dow Jones expected to open 42 points lower at 17,935 and the
Nasdaq 100 14 points lower at 4,395.
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