Dow May Open Higher On Earnings Boost

LONDON — Stock index futures at 6.30am ET indicate that the Dow Jones Industrial Average (DJINDICES: ^DJI) may open up by 0.15% this morning, while the S&P 500 (SNPINDEX: ^GSPC) may open 0.17% higher.

European markets moved higher this morning, helped by a boost to telecoms stocks driven by the news of a deal which will see Dutch group KPN sell its German E-Plus business to Spain’s Telefonica. Big miners also performed strongly following overnight news that China plans to use major infrastructure projects such as high-speed railways to help absorb surplus capacity in the country’s heavy industries.

In the US today, the FHFA home prices report for May is due at 9am ET, but no other major economic reports are due, and corporate earnings are likely to be the focus of investors’ attention.

Among the companies due to report earnings before markets open today is Air Products and Chemicals, which reported net income of $288m and earnings per share of $1.36 on a continuing operations basis for its fiscal third quarter, down by 5% and 4% respectively compared to the same period last year. Chemicals giant DuPont also reported its latest quarterly results before the opening bell, beating analysts’ earnings per share forecasts by one cent, with adjusted second-quarter earnings of $1.28 per share, down from $1.48 per share for the same period last year. Revenue also fell, dropping from $11.01bn to $9.84bn.

Lockheed Martin, United Technologies, The Travellers Companies, Altria Group, PACCAR, Peabody Energy Corp, Valero Energy and Freeport McMoRan Copper & Gold are also due to report before the open today, while Apple, AT&T, Broadcom, Discover Financial Services and Norfolk Southern are amongst those due to report after the close.

Other stocks that may be actively traded include Texas Instruments, which reported a 48% rise in second-quarter income to $660m after the close last night, beating analysts’ earnings per share expectations. Shares in the electronics firm were almost 2% higher in pre-market trading this morning. Netflix stock may also be actively traded when markets open; the movie-streaming pioneer’s share price was down by more than 5% in pre-market this morning after the firm reported just 630,000 new US streaming customers — missing analysts’ expectations for more than 700,000 new customers.

Finally, let’s not forget the Dow’s daily movements can add up to some serious long-term gains. Indeed, Warren Buffett recently wrote: “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.

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> Roland does not own shares in any of the companies mentioned in this article. The Motley Fool owns shares in Apple.