What you need to know:
> Well-received earnings from Bank of America and BlackRock help the mood.
> Netflix is due to report its second-quarter figures later in the session.
> Wall Street’s S&P 500 set to hold 5-month high in opening trade.
> US retail sales meet forecasts for June, with a month-on-month rise of 0.5%.
> European bourses rise with industrial and healthcare stocks in demand.
> Investors on look out for further Trump rhetoric on EU at meeting with Putin.
> Asian stocks knocked as China Q2 GDP growth is slowest since 2016.
“There is no doubt that President Trump has been highly positive for US equity markets, which has fed through to rising global markets, but his increasingly erratic behaviour is making it very difficult for investors to work out whether he remains a friend or foe” — Rebecca O’Keeffe, head of investment at Interactive Investor.
“The first of the Faangs to report, Netflix earnings are hugely important for investors to confirm whether the outperformance of technology stocks is warranted or if the market has got ahead of itself.”
The strong run of numbers from US earnings season is helping to support a sense of cautious optimism on stock markets as investors also watch for potential disruption from geopolitics.
Second-quarter earnings from Bank of America and BlackRock have been well-received, with shares in both financial institutions rising in pre-market trade.
Netflix is due to become the first of the Faang stocks to file its earnings later in the session. The group — made up of Facebook, Amazon, Apple Netflix and Google’s parent Alphabet — have made some of the sharpest gains in the US stock market’s record-breaking run higher.
US retail sales data for June came in exactly in line with forecasts, showing a rise of 0.5 per cent month-on-month.
According to futures trade, the S&P 500 will stay steady at the open, holding the five-month high it hit on Friday, with the Nasdaq set to tick up 0.1 per cent.
The dollar is retreating, looking tired after an advance to an 11-session high touched on Friday. The index tracking it is down 0.3 per cent at 94/46
With President Donald Trump meeting his Russian counterpart in Helsinki, sharp White House rhetoric toward the EU has added to the uncertainty.
Frankfurt’s Xetra Dax 30 is up 0.2 per cent, with support from ThyssenKrupp, the steelmaker, after reports it is considering merging its elevator business with Kone.
The region-wide Europe-wide Stoxx 600 is also up 0.2 per cent, while the CAC 40 in Paris is 0.1 per cent firmer. London’s FTSE 100 is holding steady.
The CSI 300 index of China’s major mainland stocks lost 0.6 per cent after the country’s official growth data came in at 6.7 per cent in the second quarter. The GDP reading reflected the impact of an aggressive deleveraging campaign on reduced investment in infrastructure and manufacturing.
Hong Kong’s Hang Seng ticked up 0.1 per cent.
Sydney’s S&P/ASX 200 slipped 0.4 per cent, as did the Kospi in Seoul.
Markets in Japan were closed for a national holiday.
The euro is up 0.2 per cent at $1.1705, while the pound is also 0.2 per cent higher at $1.3262. Japan’s yen is steady at ¥112.41 per dollar.
In China, the onshore renminbi exchange rate, which moves within a trading band of 2 per cent to either side of a midpoint, was steady at Rmb6.6893 against the dollar.
Oil prices are weaker, with Brent crude down 0.4 per cent at $75.03 a barrel and West Texas Intermediate off 0.7 per cent at $70.55.
Gold is up 0.3 per cent at $1,244 an ounce.