U.S. Stock Futures Slip on Retail, Consumer Data

By Riva Gold and Lucy Craymer Features Dow Jones Newswires

U.S. stock futures edged lower Friday as investors parsed corporate results ahead of key readings on retail sales and consumer prices.

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Futures pointed to a 0.2% opening decline for the S&P 500, following its biggest daily loss in three weeks--a drop of just 0.2%.

Shares of Nordstrom, Inc. were down 3.9% in premarket trading, continuing a bad week for retailers after it reported an unexpected fall in same-store sales and revenue rose less than expected.

Still, the overall earnings picture in the U.S. has been supportive of markets this quarter, with the fastest growth in earnings a share since 2011, according to CFRA Research. That has helped U.S. stock indexes hover close to record highs, while volatility has fallen to ultralow levels.

"The first quarter earnings seasons is one of the best overall we've seen in the past decade," said Olivier Marciot, investment manager at Unigestion.

Later Friday, investors will be watching to see if U.S. retail sales can rebound from a fall in the last two months to match signs of consumer optimism and a strong labor market.

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"Consumption has been kind of weak in the last couple of months...but we are not worried at all for the moment about the U.S. consumer," Mr. Marciot said.

Elsewhere, European stocks inched slightly higher Friday as data showed Germany's economy outpaced the U.S. at the start of the year. The Stoxx Europe 600 was up 0.1% late morning despite losses in the U.S. and Asia.

"People are kind of gravitating toward Europe, because for now, all of a sudden Europe has economic growth," said Jimmy Chang, chief investment strategist at Rockefeller & Co.

European stocks are close to two-year highs as political jitters have given way to increasing signs of an improving economy and corporate earnings. Investors have poured money into the region's equities in recent weeks, with a record inflow of $6.1 billion into European equities since centrist Emmanuel Macron won the French election, according to Bank of America Merrill Lynch.

Earlier, stock markets were broadly lower in Asian trading hours, tracking weakness in Europe and the U.S. on Thursday. Japan's Nikkei Stock Average fell 0.4% Friday as the yen strengthened modestly against the dollar, but gained 2.3% for the week.

South Korea's Kospi was off 0.5% after reaching a record high, while Australia's S&P/ASX 200 declined 0.7% amid declines in the tech sector.

Hong Kong's Hang Seng Index inched higher for a fifth consecutive trading day 0.1% while the Shanghai Composite rose 0.7%, led by gains in insurance, aviation and automotive shares.

Analysts also pointed to some encouragement around China's equities after the Trump administration said it had agreed with Beijing on a broad range of measures aimed at improving the access of American beef producers, electronic-payments providers and natural-gas exporters to the world's second-largest economy.

In commodities, Brent crude oil was down 0.2% at $50.68 a barrel, while copper futures advanced 0.1% to $5,545 a ton and gold inched up 0.3% to $1,228 an ounce.

10-year U.S. Treasury yields edged down to 2.376% from 2.400% Thursday, while German bund yields fell to 0.416% from 0.428%. Yields move inversely to prices.

Lucy Craymer, Jacob M. Schlesinger and Nina Adam contributed to this article.

Write to Riva Gold at riva.gold@wsj.com and Lucy Craymer at Lucy.Craymer@wsj.com

U.S. stock futures edged lower Friday as investors parsed corporate results and key readings on retail sales and consumer prices.

Futures pointed to a 0.2% opening decline for the S&P 500, following its biggest daily loss in three weeks -- a drop of just 0.2%.

Retail sales improved in April -- but less than expected. Sales at U.S. stores, restaurants and online retailers increased a seasonally adjusted 0.4% in April from the prior month, the Commerce Department said Friday. Economists surveyed by The Wall Street Journal had expected a 0.5% gain.

Meanwhile, consumer prices rose only modestly in April, a sign inflationary pressures are stabilizing this spring after a monthslong acceleration. The consumer-price index, which measures what Americans pay for everything from radishes to rent, advanced a seasonally adjusted 0.2% in April from the prior month, matching expectations.

"Consumption has been kind of weak in the last couple of months...but we are not worried at all for the moment about the U.S. consumer," Mr. Marciot said ahead of the reports.

In corporate news, shares of Nordstrom slipped 5% in premarket trading, continuing a bad week for retailers after it reported an unexpected fall in same-store sales and revenue rose less than expected.

Still, the overall earnings picture in the U.S. has been supportive of markets this quarter, with the fastest growth in earnings a share since 2011, according to CFRA Research. That has helped U.S. stock indexes hover close to record highs, while volatility has fallen to ultralow levels.

"The first quarter earnings seasons is one of the best overall we've seen in the past decade," said Olivier Marciot, investment manager at Unigestion.

Elsewhere, European stocks inched slightly higher Friday as data showed Germany's economy outpaced the U.S. at the start of the year. The Stoxx Europe 600 was up 0.1% late morning despite losses in the U.S. and Asia.

"People are kind of gravitating toward Europe, because for now, all of a sudden Europe has economic growth," said Jimmy Chang, chief investment strategist at Rockefeller & Co.

European stocks are close to two-year highs as political jitters have given way to increasing signs of an improving economy and corporate earnings. Investors have poured money into the region's equities in recent weeks, with a record inflow of $6.1 billion into European equities since centrist Emmanuel Macron won the French election, according to Bank of America Merrill Lynch.

Earlier, stock markets were broadly lower in Asian trading hours, tracking weakness in Europe and the U.S. on Thursday. Japan's Nikkei Stock Average fell 0.4% Friday as the yen strengthened modestly against the dollar, but gained 2.3% for the week.

South Korea's Kospi was off 0.5% after reaching a record high, while Australia's S&P/ASX 200 declined 0.7% amid declines in the tech sector.

Hong Kong's Hang Seng Index inched higher for a fifth consecutive trading day 0.1% while the Shanghai Composite rose 0.7%, led by gains in insurance, aviation and automotive shares.

Analysts also pointed to some encouragement around China's equities after the Trump administration said it had agreed with Beijing on a broad range of measures aimed at improving the access of American beef producers, electronic-payments providers and natural-gas exporters to the world's second-largest economy.

In commodities, Brent crude oil was down 0.2% at $50.68 a barrel, while copper futures advanced 0.1% to $5,545 a ton and gold inched up 0.3% to $1,228 an ounce.

10-year U.S. Treasury yields edged down to 2.376% from 2.400% Thursday, while German bund yields fell to 0.416% from 0.428%. Yields move inversely to prices.

Lucy Craymer, Jacob M. Schlesinger and Nina Adam contributed to this article.

Write to Riva Gold at riva.gold@wsj.com and Lucy Craymer at Lucy.Craymer@wsj.com

(END) Dow Jones Newswires

May 12, 2017 08:56 ET (12:56 GMT)