GE Spikes, This Finance Leader Sets Up For Breakout

Energy stocks and chipmakers were under investors’ microscopes early Friday, with the Dow, S&P 500 and Nasdaq defending solid gains for the week. But futures for all three benchmarks turned lower in Friday’s volatile premarket trade.

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Dow Jones industrial average futures slipped a fraction, despite strong gains from General Electric (GE) following its quarterly report. Other Dow issues held to tame trade. Chevron (CVX) was up top with a 0.6% gain. At the weak end, Procter & Gamble (PG) slipped 0.9%.

The Nasdaq 100 also slipped back into narrow early declines, with China’s JD.com (JD) and Tesla (TSLA) showing the index’s largest early declines. S&P 500 futures struggled to a slight gain, with GE leading, and Honeywell (HON) and Tractor Supply (TSCO) up 2.2% and 1.5%, respectively. Honeywell posted strong first-quarter results. Tractor Supply received an analyst upgrade.

Apple (AAPL) slipped 0.5% and three of four FANG stock tech leaders lost ground.

The Dow industrials ended Thursday’s session up 1.3% so far for the week, despite two consecutive losses. The S&P 500 held a 1.4% gain, while the Nasdaq was ahead 1.9%. All three indexes have maintained support at their 50-day moving averages, although Thursday’s session flashed the first signs of institutional selling since the market launched its new uptrend April 10.

Outside the U.S., global stock markets were mixed Friday. Asian stock markets closed lower, led by a 1.5% dive for China’s Shanghai Composite. In Europe, leading benchmarks weakened into mixed afternoon trade. Frankfurt’s DAX reversed early gains and slipped 0.3%. London’s FTSE 100 defended a 0.3% gain.

Futures Drivers: GE, Ericsson, TransUnion

Earnings news was generally positive ahead of Friday’s open. On the Dow, General Electric leapt more than 7%. The rapidly slimming industrial giant reported adjusted losses and revenue declines that beat analyst estimates. The company took a heavy one-time charge during the quarter related to its former sub-prime lending business.

But it also affirmed financial targets for the year and said it expects proceeds between $5 billion and $10 billion from sales of assets during the year. GE’s conference call is scheduled at 8:30 a.m. ET. Company shares are down 20% since the start of the year, and 56% below their July 2016 high.

Sweden-based smart phone maker Ericsson (ERIC) erupted to a 17% premarket gain. A 104% surge in first-quarter earnings topped analyst expectations by a wide margin, and marked the company’s first earnings-per-share increase in seven quarters. The stock trades below 10.

TransUnion (TRU) rung up a 6% premarket gain as first-quarter results cleared analysts forecast by comfortable margins. Management also hoisted its second-quarter earnings and revenue guidance to well above consensus views. The premarket move suggested the stock could score a breakout at the starting bell above a 61.52 buy point in a four-month flat base. But be cautious, not all premarket moves carry over into regular trade.

Update: Energy Stocks, Chipmakers

Energy stocks have provided the market with some rising leadership potential as oil prices sit near 3-year highs and are up 13% year-to-date. Crude oil prices were down 0.6% early Friday, with U.S. benchmark crude slipping just below $68 per barrel. Prices may see some effect when Baker Hughes (BHGE) releases its weekly rig count report at 1 p.m. ET.

Baker Hughes also reported its first-quarter results Friday, rising 0.2% after beating earnings views, but with revenue just below consensus estimates. Oilfield services heavyweight Schlumberger (SLB) fell 1% after its first-quarter earnings met analyst targets.

The chip sector remains under careful watch on the stock market today. Investors are looking for signs of either a rebound or of further losses, a day after the Philadelphia Semiconductor Index dived 4.3%. The sell-off resulted from industry demand concerns raised by guidance from Taiwan Semiconductor (TSM) in its earnings report Thursday.

Philly Chip Index stocks traded narrowly mixed early Friday. Among the index’s biggest decliners on Thursday — MKS Instruments (MKSI) rose 0.3% in premarket trade Friday. Lam Research (LRCX) fell 0.4% and Applied Materials (AMAT) posted a fractional decline.

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