Investing.com - Here are the top five things you need to know in financial markets on Tuesday, October 30:
1. Trump expects a “great deal” with China
Investors will keep a close eye on the continuing trade dispute between the U.S. and China, as U.S. President Donald Trump confirmed, in an interview with Fox News, that he was prepared to slap China with billions more dollars in tariffs if no agreement is made between the world’s two largest economies.
However, he showed optimism, insisting that he expects a “great deal” to be reached with China.
The interview followed a Bloomberg report that roiled markets, saying the U.S. is preparing to impose tariffs on the remaining $257 billion of Chinese imports if talks in November between Trump and Chinese leader Xi Jinping do not go well.
The two leaders are due to meet during the Group of 20 leaders summit in Argentina at the end of November.
2. Dow components to lead earnings parade
Several household names are reporting their latest results on Tuesday in the last big week for third-quarter earnings on Wall Street.
According to Thomson Reuters, 78% of the S&P 500 companies that have reported have exceeded consensus earnings estimates, putting the index on track for a 25.2% year-over-year increase in earnings, 3.6% above estimates as of Sept. 30.
Coca Cola (NYSE:KO), General Electric (NYSE:GE) and Pfizer (NYSE:PFE) will be the Dow companies to watch ahead of the bell on Tuesday, while, outside the blue chip index, investors will also keep an eye on earnings from MasterCard (NYSE:MA) and Under Armour (NYSE:UA).
Facebook (NASDAQ:FB) and eBay (NASDAQ:EBAY) will report results after the close.
3. U.S. futures point higher
Although Monday’s selloff on the back of the escalating tariff dispute saw the S&P 500 close in bear market territory, the paring of losses in the last 15 minutes of the session gave investors some hope for recovery that looked set to continue to on Tuesday.
At 5:40 AM ET (9:40 GMT), the blue-chip Dow futures gained 48 points, or 0.20%, S&P 500 futures rose 7 points, or 0.25%, while the Nasdaq 100 futures inched up 4 points, or 0.05%.
Elsewhere, European shares gave up earlier gains as economic growth in France, Italy and the wider euro zone missed expectations.
Earlier, Asian stocks managed to claw back early losses to end the session in positive territory as Trump’s remarks on an expected “great deal” eased concerns over trade tensions.
4. Dollar holds near 10-week high ahead of consumer confidence
The dollar moved back towards 10-week highs against a currency basket on Tuesday as heightened trade tensions exacerbated fears of a slowdown in global economic growth, bolstering safe haven demand.
At 5:42 AM ET (9:42 GMT), the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, gained 0.19% at 96.76, close to the 10-week high of 96.62 set on Friday.
The highlight of the economic calendar on Tuesday will be the latest reading on the health of the consumer, with confidence hovering around levels not seen since 2000.
The Conference Board will release its consumer confidence index at 10:00 AM ET (14:00 GMT) and economists expect the index to slip to 136 in October from 138.4 in the previous month.
5. Oil prices drop on promises of increased output
Oil prices headed lower on Tuesday as Saudi Arabia and Russia vowed to raise crude output, slashing market concerns over looming sanctions on Iran that kick off on Nov. 4.
U.S. crude oil futures lost 31 cents, or 0.46%, to $66.73 by 5:43 AM ET (9:43 GMT), while Brent oil traded down 34 cents, or 0.44%, to $77.03.
Saudi Arabia pledged earlier in the month to raise oil output to offset the fall from Iranian exports expected to be caused by the U.S. sanctions, while Russia, also said on Saturday that there is no reason for the country to cut its production levels.
After many months of concern about shortage of supply ahead of U.S. sanctions on Iran, the oil market is beginning to be concerned about possible oversupply and inventories that are rising in many parts of the world.
The latest reading on U.S. crude stockpiles will come late Tuesday from the American Petroleum Institute, while official government data will be released a day later amid expectations for a build of 3.67 million barrels.
If confirmed, that would be the sixth straight weekly climb that has already seen domestic supplies swell by a total of 28.7 million barrels over that period.