Investing.com - Here are the top five things you need to know in financial markets on Friday, April 13:
1. Trump trade turnaround
U.S. President Donald Trump appears to have shifted gears on trade policies as he told his top economic advisors to study the possibility of reentering a massive Pacific trade deal, suggesting a turnaround from his prior confrontational stance.
The President told chief economic advisor Larry Kudlow and U.S. Trade Representative Robert Lighthizer to examine a return to the Trans-Pacific Partnership (TPP) that Trump abandoned in 2017, according to a White House spokesperson.
However, Trump did emphasize late Thursday that the rejoining TPP would only be an option if the U.S. received “substantially better” terms than the previous deal.
Asian equities celebrated the apparent backtracking with Japan’s Nikkei ending the session with gains of 0.6%. China’s Shanghai Composite was a notable exception, closing down around 0.7% on the back of a weak reading in exports.
European shares also traded mostly higher on Friday, though some weak earnings reports limited gains.
U.S. futures pointed to a mixed open on Friday. Coming after the prior session’s strong gains, investors looked ahead to bank earnings and economic data. At 5:35AM ET (9:35GMT), the blue-chip
Dow futures gained 28 points, or 0.11%, S&P 500 futures advanced 2 points, or 0.08%, while the Nasdaq 100 futures lost 9 points, or 0.13%.
2. Banks kick off earnings season
Banks will unofficially kick off the first-quarter earnings season on Friday as major financial institutions prepare to unveil the effect of tax cuts and increasing interest rates on the bottom line.
Overall, expectations are for profits at S&P 500 firms to grow 18.4% in what would be their biggest quarterly profit in seven years.
JP Morgan (NYSE:JPM), the first component of the Dow Jones to report this season, is scheduled to release earnings at around 7:00AM ET (11:00GMT), followed by Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC) approximately one hour later.
Analysts are forecasting earnings per share of $2.28, $1.61 and $1.06, respectively.
3. Oil heads for weekly gains of 9%
Oil prices moved higher on Friday as another monthly report pointed to tightening markets.
OPEC and its allies appear to have accomplished their mission of bringing global oil stocks to desired levels, the International Energy Agency (IEA) said in its monthly report released Friday, predicting that inventories should drop to their five-year average -a metric used by OPEC to measure the success of output cuts- by as early as May.
"It is not for us to declare on behalf of the Vienna agreement countries that it is 'mission accomplished', but if our outlook is accurate, it certainly looks very much like it," the IEA said in its monthly report.
U.S. crude oil futures rose 0.64% to $67.50 at 5:36AM ET (9:36GMT), while Brent oil traded up 0.64% at $72.48.
Buoyed by geopolitical tension over Syria earlier in the week, the U.S. benchmark was on track for weekly gains of 8.8%, while Brent was up around 8%. The move would be the largest weekly rise since last July.
Later on Friday, market participants will keep an eye on increasing U.S. shale production with the Baker Hughes’ weekly rig count data.
4. Consumer confidence in focus
On Friday’s economic calendar, traders will focus on the preliminary reading of consumer sentiment for April to be released by the University of Michigan at 10:00AM ET (14:00GMT).
The index is expected to drop to 100.6 from the 101.4 registered in March that was its highest level since 2004.
Also on the economic docket, the U.S. Labor Department will release its Job Openings and Labor Turnover Survey (JOLTs) at the same time.
Furthermore, market participants will keep an eye on appearances by Federal Reserve members Eric Rosengren at 8:00AM ET (12:00GMT), James Bullard at 9:00 AM ET (13:00GMT) and Robert Kaplan at 1:00PM ET as they monitor for clues on whether policymakers remain optimism on inflation and economic growth.
Ahead of these references, the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, slipped 0.09% to 89.41 by 5:36AM ET (9:36GMT).
5. China registers first trade deficit in a year
Trade data released Friday showed that Chinese exports unexpectedly fell in March, causing the world’s second largest economy to post its first trade deficit in dollar-denominated terms since February 2017.
Specifically, China’s trade deficit hit $4.98 billion in March, compared to the prior month’s $33.75 billion surplus. That was as its exports unexpectedly declined 2.7% on the year, compared to a forecast for a 10.0% gain. Imports rose 14.4%, beating expectations for a 10.0% advance.
Despite the monthly deficit, China's trade surplus with the U.S. surged nearly 20% in the first quarter with analysts indicating that exporters had sped up shipments in the first three months of the year to get ahead of any threatened tariffs.