STOCK MARKET NEWS: Futures gain, GDP due, Tesla shares rise

U.S. equity futures traded mixed Thursday morning ahead of earnings reports and an update on economic growth.

Oil prices were steady on Thursday after U.S. crude stocks climbed less than expected.

U.S. West Texas Intermediate (WTI) crude futures traded around $80.00.

Brent crude futures traded around $86.00 per barrel.

Traders will get a first look at fourth-quarter GDP. 

Economists surveyed by Refinitiv expect the Commerce Department to say the economy grew at a 2.6% annual rate from October through December. That’s down from a 3.2% pace in the third quarter on strong consumer spending and rising exports. 

In addition to GDP, traders will examine the latest jobless claims, durable goods and new home sales.

Tesla shares rose more than 6% in premarket trading after the company beat analysts’ estimate for fourth-quarter revenue on Wednesday, powered by record delivery of electric vehicles during the last three months of 2022.

In Asia, the Nikkei 225 in Tokyo shed 0.1% and the Hang Seng in Hong Kong rose 2.3%. Markets in China were closed for a holiday.

On Wall Street,
the benchmark S&P 500 index lost less than 0.1% to 4,016.22 after rebounding from a morning loss of 1.7%.

The Dow Jones Industrial Average recovered from a similar drop to end up less than 0.1%, to 33,743.48. The Nasdaq composite fell 20.91 points, or 0.2%, to 11,313.36.

Tesla shares rose than 6% in premarket trading after the company beat analysts’ estimate for fourth-quarter revenue on Wednesday, powered by record delivery of electric vehicles during the last three months of 2022.

The company said revenue was $24.32 billion for the three months ended Dec. 31, compared with analysts’ average estimate of $24.16 billion, according to IBES data from Refinitiv.

A busy morning of economic data on deck for investors.

Traders will get a first look at fourth-quarter GDP. 

Economists surveyed by Refinitiv expect the Commerce Department to say the economy grew at a 2.6% annual rate from October through December. That’s down from a 3.2% pace in the third quarter on strong consumer spending and rising exports. 

The Labor Department will tell us how many workers filed new jobless claims last week. Expectations are for 205,000 after falling unexpectedly to 190,000 the previous week, the lowest since September. 

Continuing claims, which track the total number of workers collecting unemployment benefits, are expected to edge up to 1.659 million, close to a 10-month high.

 At the same time the Commerce Department’s Census Bureau is expected to say that new orders for manufactured big-ticket items jumped 2.5% seasonally adjusted in December, following a deeper-than-expected 2.1% slump the previous month. 

If you factor out the transportation component, orders are anticipated to edge down 0.2% after a surprise increase of 0.1% in November. Orders for core capital goods, a closely watched proxy for business spending, are also expected to slip 0.2%, following a surprise increase of 0.1% the previous month. 

The Commerce Department is expected to say that sales of new single-family homes fell 3.6% to a seasonally adjusted annual rate of 617 thousand in December. That would follow a surprise surge of 5.8% in November.

Oil prices were steady on Thursday after U.S. crude stocks climbed less than expected.

U.S. West Texas Intermediate (WTI) crude futures traded around $80.00.

Brent crude futures traded around $86.00 per barrel.

Crude inventories edged higher by 533,000 barrels to 448.5 million barrels in the week ending Jan. 20, the Energy Information Administration (EIA) said.

That was substantially short of forecasts for a 1 million barrel rise, though crude stocks are at their highest since June 2021, the EIA said.

The nationwide price for a gallon of gasoline gained on Thursday to $3.502, according to AAA.

The average price of a gallon of gasoline on Wednesday was $3.481.

A year ago, the price for a gallon of regular gasoline was $3.342.

One week ago, a gallon of gasoline cost $3.379. A month ago, that same gallon of gasoline cost $3.102.

Gas hit an all-time high of $5.016 on June 14.

Diesel gained, but remained below $5.00 per gallon to $4.681, but that is still far from the $3.683 of a year ago.

Boeing representatives and relatives of some of the passengers killed in two crashes of Boeing 737 Max jets will be in a Texas courtroom Thursday.

The aerospace giant will be arraigned on a criminal charge that it thought it had settled two years ago.

The family members were never consulted before Boeing cut a deal with the U.S. Justice Department to avoid prosecution on a felony charge of fraud. Up to a dozen or so people from several countries are expected to testify about how the loss of loved ones has affected them.

There will be two main phases to the arraignment: Boeing will enter a plea, and then relatives of the passengers will ask the court to impose conditions on Boeing much as it would on any criminal defendant.

Boeing has faced civil lawsuits, congressional investigations and massive damage to its business since the crashes in 2018 and 2019, which killed a combined total of 346 people. 

Boeing and its top officials have avoided criminal prosecution, however, because of the settlement reached between the company and the government in January 2021.

The Associated Press contributed to this post.

IBM shares are down nearly 2% in premarket trading after the company reported flat sales in the fourth quarter after the strong U.S. dollar hurt its reported revenue by more than $1 billion.

IBM posted net income of $2.71 billion, or $2.96 a share, for the fourth quarter, compared with $2.33 billion, or $2.57 a share, a year earlier.

Adjusted earnings were $3.60 a share, slightly above analysts’ estimates of $3.59 a share. 

Revenue edged down to $16.69 billion from $16.70 billion a year earlier. Analysts polled by FactSet expected $16.15 billion. 

The IT software and consulting company also forecast annual revenue growth in the mid-single digits on constant currency terms, weaker than the 12% it reported for 2022 but in line with mid-term targets announced in 2021.

IBM’s full-year revenue grew 5.5% to $60.53 billion.

IBM joined the wave of companies making layoffs, saying it would cut about 3,900 jobs, according to the Wall Street Journal.

The cuts will stem from Kyndryl Holdings Inc., the IT services business that IBM spun off last year, and its healthcare divestiture, from which the company will incur about a $300 million charge, a spokesman confirmed. 

Earnings season continues Thursday, with three Dow members reporting: Intel and Visa in the afternoon, and commodity chemical maker Dow Inc. ahead of the opening bell. 

The morning will also see results from telecom and media giant Comcast, aerospace/defense firm Northrop Grumman, credit-card payment processor Mastercard, and paint and coatings manufacturer Sherwin-Williams to name a few. 

Also watch for numbers from a handful of airlines: American, Southwest, JetBlue, and Alaska Air. 

Bitcoin was trading around $23,000, after gaining in five of the past seven days.

In the past week, Bitcoin has gained more than 11%.

For the month, the cryptocurrency is higher by more than 42%, but remains down more than 35% over the last 52 weeks.

Ethereum was trading around $1,600, after gaining more than 6% in the past week.

Dogecoin was trading at 8 cents, after adding more than 8% in the past week.