US markets look set to open lower today as markets focus in on earnings from AT&T, McDonald’s, Lockheed Martin, Comcast, Amgen and Gilead Sciences to name but a few. Futures suggest the S&P500 will open 1 point lower at 1,871 with the Dow Jones expected to open 14 points lower at 16,435. The pharmaceutical sector has been active in recent days. Shares in AstraZeneca flew higher on Monday after a $100bn take-over bid from Pfizer. Allergen, the maker of Botox is also said to be subject to a bid by hedge fund manager Bill Ackman and Valeant Pharmaceuticals for $50bn. So far around 70% of companies have beaten earnings, largely because estimates have been lowered due to the poor weather. The more important thing to look for are companies’ outlook for Q2 and the rest of the year; so far the general consensus among CEOs is for modest improvements in growth. Netflix reported first quarter earnings of $0.86 per share on revenue 24% higher than the previous quarter at $1.27bn. The company issued a strong outlook saying it expects to double its US user base and also announced it will raise prices for new customers by $1-$2 per month. After biotech stocks led the sell-off this year, particular attention might be paid to bellwether companies Amgen and Gilead Sciences who report after the bell today. Gilead Sciences are expected to show Q1 profits of $0.89 per share on revenue of $3.92bn. The company will be looking to convince investors that the political pressure on drug pricing from the company's hepatitis C drug Sovaldi is not impacting earnings. The likelihood is that earnings to date will be good, but probably more important for the stock price going forward will be any guidance on the future pricing structure of Sovaldi and other product lines. Without assurance that companies in the sector can continue to charge similar prices, biotech may well remain under pressure despite beating earnings expectations. Amgen are expected to show earnings of $1.94 per share on revenue of $4.76bn. Some other key Dow Jones and S&P stocks traders will be watching are as follows: AT&T is expected to report Q1 earnings of $0.70 per share on revenue of $32.44bn. McDonald’s is expected to rreport its Q1 earnings at $1.24 per share on revenue of $6.73bn. Lockheed Martin’s Q1 earnings are expected at $2.53 per share on revenue of $10.89bn. Comcast is projected to report Q1 earnings of $0.64 per share on revenue of $17.04bn. CMC Markets is an execution only provider. The material (whether or not it states any opinions) is for general information purposes only, and does not take into account your personal circumstances or objectives. Nothing in this material is (or should be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by CMC Markets or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.
US stocks steady with busy earnings day including key biotech names
19:00, 21 April 2014