Breaking News
Get 40% Off 0
👀 Reveal Warren Buffett's stock picks that are beating the S&P 500 by +174.3% Get 40% Off

Bank earnings ahead, Microsoft-Activision deal latest - what's moving markets

Published Oct 13, 2023 05:13AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters.
 
MSFT
+0.45%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
US500
+0.80%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
C
+0.20%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
DOW
-0.21%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
GS
-0.29%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 
JPM
-0.39%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

Investing.com -- U.S. stock futures were mixed heading into the final trading day of the week, with investors preparing for the release of quarterly results from large Wall Street banks and parsing through recent inflation data. Elevated interest rates are expected to factor heavily into returns from lenders JPMorgan (NYSE:JPM), Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) on Friday, as a fresh corporate earnings season gets underway. Elsewhere, the U.K.'s competition regulator approves Microsoft's (NASDAQ:MSFT) restructured acquisition of Activision Blizzard (NASDAQ:ATVI), clearing the way for the closure of the largest deal in the history of the gaming industry.

1. Futures mixed

Stock futures in New York were mixed on Friday, as traders geared up for results from major banks and digested stronger-than-anticipated U.S. consumer price data.

By 05:08 ET (09:08 GMT), the Dow futures contract had added 38 points or 0.1%, S&P 500 futures were mostly unchanged, and Nasdaq 100 futures edged down by 21 points or 0.1%.

The main indices closed lower in the prior session, weighed down by a jump in U.S. Treasury yields in the wake of data showing higher-than-expected annual headline inflation in the world's largest economy in September. The reading fueled projections that the Federal Reserve may need to raise interest rates yet again before the end of the year to cool stubbornly elevated price gains.

Ongoing violence in the Middle East also contributed to a cautious mood in markets.

The 30-stock Dow Jones Industrial Average slipped by 0.5%, while the benchmark S&P 500 and the tech-heavy Nasdaq Composite both fell by 0.6%.

2. Bank earnings ahead

Attention now turns to returns from key Wall Street lenders on Friday, an event that typically marks the beginning of the quarterly corporate earnings season.

JPMorgan, the country's biggest bank, as well as peers Wells Fargo and Citigroup, are all set to report.

A recent surge in interest rates will likely be in focus. Analysts have flagged concerns that the tighter financial conditions may have dented lending margins and contributed to a slowdown in loan demand, placing pressure on balance sheets.

Meanwhile, firms with large investment banking operations, such as Goldman Sachs, are facing an era of relative weakness in dealmaking. According to Dealogic data cited by Reuters, global investment banking fees have dropped by around 17% in the third quarter compared to the same timeframe last year.

A weeks-long spike in U.S. Treasury yields to 16-year highs also threatens to take its toll. Prices typically fall as yields rise, meaning that bond portfolios owned by these banks shrink in value. This could lead to unrealized losses should these companies choose to sell the bonds -- a trend that played a part in the regional banking crisis in March.

Throughout 2023, the path of borrowing costs has impacted lenders across the industry, with the KBW index of bank stocks slipping by almost 23% so far this year.

3. Chinese inflation lower than projected in September

Consumer prices in China were unexpectedly flat in September, exacerbating worries over persistent deflationary pressures in the world's second-largest economy.

The country's consumer price index came in at 0.0% last month on an annual basis, according to National Bureau of Statistics data, cooling from 0.1% in August. Economists had estimated a slight acceleration in the crucial inflation indicator to 0.2%.

September factory-gate prices also dropped by 2.5% from a year ago, a faster rate of decline than market projections for a 2.4% fall. However, it was the smallest dip in seven months.

In a note, analysts at ING said that, despite emerging signs of stabilizing activity, the numbers point to lingering challenges in China's sputtering post-COVID recovery.

4. Oil gains amid U.S. sanctions

Crude prices rose Friday following a move by the U.S. to impose the first sanctions on owners of tankers carrying Russian oil priced above the G7's cap of $60 a barrel, potentially weighing on an already tight global supply.

The news overshadowed U.S. crude oil stockpiles jumping by more than 10 million barrels last week -- the most in eight months -- while output from the world’s largest producer of the commodity hit a new record high of 13.2 million barrels per day, according to Thursday’s official data.

By 05:10 ET, the U.S. crude futures traded 3.0% higher at $85.41 a barrel and the Brent contract climbed 2.9% to $88.46 a barrel.

Brent is set for a weekly gain of 3.8%, while WTI is on pace to add 2.4%. Both contracts surged on Monday following Hamas' surprise attack on Israel.

5. U.K. competition regulator approves Microsoft-Activision megadeal

Britain's antitrust watchdog on Friday gave the green light to Microsoft's $69 billion purchase of "Call of Duty" maker Activision Blizzard, clearing the way for an imminent closure of the gaming industry's largest-ever deal following almost two years of legal reviews.

The Competition and Markets Authority (CMA) approved a revised tie-up that will see Activision sell its cloud streaming rights to French video game group Ubisoft Entertainment. This effectively blocks Microsoft from making Activision's lucrative titles exclusive on its Xbox Cloud Gaming service, which the CMA had said could give the group dominance in a rapidly growing market.

Microsoft is now on track to close the deal by Oct. 18. It had previously extended the deadline to finalize the acquisition by three months in a bid to restructure the agreement to assuage the CMA's concerns.

Bank earnings ahead, Microsoft-Activision deal latest - what's moving markets
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
Kalde Donii
Kalde Donii Oct 17, 2023 1:50PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Ethopan bank
Kalde Donii
Kalde Donii Oct 17, 2023 11:12AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
We on 014251095244101
Amane Dhekamo
Amane Dhekamo Oct 13, 2023 6:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
05 510 98399
Amane Dhekamo
Amane Dhekamo Oct 13, 2023 6:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
want business
Lavonne Silva sanchez
Lavonne Silva sanchez Oct 13, 2023 6:54AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
yes
Michael Benson
Michael Benson Oct 13, 2023 6:40AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
International trade agreements impact markets around the world.
Michael Benson
Michael Benson Oct 13, 2023 6:40AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Low interest rates make borrowing more attractive for businesses.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email