Investing.com - Here are the top five things you need to know in financial markets on Wednesday, April 17:
1. China’s economy grows 6.4%, dampening slowdown concerns
China released a deluge of better-than-expected economic data overnight, easing concerns over the slowdown in the world’s second largest economy.
Gross domestic product grew 6.4% in the first quarter, a touch better than the 6.3% forecasts by economists.
Industrial production and retail sales also increased more than expected in March, suggesting that the economy has momentum going into the second quarter.
In reaction to the news, prices on safe haven sovereign bonds fell, pushing yields on the U.S. 10-year Treasury and the comparable German Bund to one-month highs. Stocks in Europe rose, as did commodities such as crude oil and copper.
Analysts did warn however that it was too soon to predict a sustainable turnaround, suggesting that Beijing would need to provide further fiscal stimulus to support growth.
2. IBM , Netflix earnings strike wrong notes
Tech earnings released after Tuesday’s close were set to dampen investor sentiment on Wednesday, fueling fears of a first overall decline in quarterly profit from S&P 500 firms since 2016.
IBM (NYSE:IBM) fell 2.6% in premarket trade after reporting a bigger-than-expected decline in revenue, casting fresh doubt over its cloud-based turnaround strategy.
Netflix (NASDAQ:NFLX) also dampened spirits after its forecast for second-quarter earnings missed analysts’ expectations. Shares were off 1.2%.
The financial sector will remain in focus Wednesday with Morgan Stanley (NYSE:MS) and US Bancorp (NYSE:USB) reporting ahead of the open. PepsiCo (NASDAQ:PEP) and Kinder Morgan (NYSE:KMI) are also due to report later.
3. U.S. futures higher ahead of Zoom, Pinterest IPO pricings
U.S. futures pointed to a higher open as the positive economic data from China boosted risk sentiment. At 5:32 AM ET (9:32 GMT), the blue-chip Dow futures were up 22 points, or 0.1%, S&P 500 futures traded up 5 points, or 0.2%, while the Nasdaq 100 futures ,had advanced 18 points, or 0.2%.
Two of the year's biggest IPOs to date, Pinterest (NYSE:PINS) and Zoom (NASDAQ:ZM), are expected to price after the close ahead of their stock market debut on Thursday. Zoom, which is already profitable, was reported to have raised its price band due to higher-than-expected demand, while Pinterest appears to have had more difficulty attracting investors, setting a valuation range below that of its last private funding round.
With U.S.-China negotiations in the background, economic data on U.S. trade figures will deserve attention when released at 8:30 AM ET (12:30 GMT). On average, economists expect that the U.S. trade deficit widened to $53.5 billion in February, according to forecasts compiled by Investing.com.
Read more: 3 China Tech Stocks Poised To Outperform As Potential Trade Deal Nears - Jesse Cohen
Also on the calendar, St. Louis Fed president James Bullard and Philadelphia Fed chief Patrick Harker are scheduled to speak on monetary policy and the economic outlook later on Wednesday.
4. Qualcomm jumps on settlement with Apple, Intel receives a boost
Shares of Qualcomm (NASDAQ:QCOM) soared 6% in premarket trade Wednesday after it reached a reached a surprise settlement with Apple (NASDAQ:AAPL) that will force the iPhone to once again use the company’s modem chips.
Intel (NASDAQ:INTC), which had supplied chips for the iPhone after Apple's rift with Qualcomm, announced hours later that it would exit the 5G smartphone modem business. Markets applauded the decision to abandon a high-cost investment, pushing the shares up 2.6%.
5. Oil prices get China boost ahead of expected crude inventory draw
Oil traded higher on Wednesday as the upbeat Chinese data boded well for crude demand and attention shifted to official U.S. government data on inventories.
U.S. crude oil futures gained 42 cents, or 0.7%, to $64.47 by 5:36 AM ET (9:36 GMT), while Brent oil rose 39 cents, or 0.5%, to $72.11.
The U.S. Energy Information Administration will release weekly data on U.S. crude oil inventories at 10:30 AM ET (14:30 GMT) amid expectations for a draw of 1.2 million barrels, in what would be the first decline in four weeks.
The American Petroleum Institute data released Tuesday - although not perfectly correlated with the EIA's report - showed weekly crude stockpiles fell by 3.1 million barrels last week.