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Market Snapshot: Wall Street set for weaker start after China data

U.S. stock futures edged lower Monday as slower-than-forecast growth in China set off a cautious tone ahead of huge slate of earnings.

What’s happening
  • Futures on the Dow Jones Industrial Average
    YM00,
    -0.27%

    slipped 112 points, or 0.3%, to 35059
  • Futures on the S&P 500
    ES00,
    -0.32%

    slipped 0.4%, or 16 points, to 4446
  • Futures on the Nasdaq 100
    NQ00,
    -0.41%

    dropped 0.4%, or 67 points, to 15067

On Friday after the release of stronger-than-forecast retail sales figures, the Dow Jones Industrial Average
DJIA,
+1.09%

rose 382 points, or 1.09%, to 35295, the S&P 500
SPX,
+0.75%

increased 33 points, or 0.75%, to 4471, and the Nasdaq Composite
COMP,
+0.50%

gained 74 points, or 0.5%, to 14897.

What’s driving markets

China reported 4.9% year-over-year growth in the third quarter, a big slowdown from the 7.9% recorded in the second quarter as construction output slowed.

U.K. bond yields
TMBMKGB-02Y,
0.721%

spiked after the governor of the Bank of England said the central bank would have to act because of concerns that rising prices will lift medium-term inflation expectations. U.S. central bank officials have not been as alarmed by the rise in prices.

There’s also U.S. data on the way in the form of industrial production and home builder sentiment figures.

Earnings season kicks into higher gear this week with releases from Netflix
NFLX,
-0.87%
,
Tesla
TSLA,
+3.02%

and International Business Machines
IBM,
+0.85%
,
among others.

“The percent of companies beating expectations on both EPS and revenues has admittedly been tracking a little below last quarter’s levels, but both stats are still extremely strong relatively to history – at 79% for EPS and 82% for sales,” said strategists at RBC Capital Markets led by Lori Calvasina. “Most companies have also highlighted continued strength in underlying demand, something that has enabled investors to look past supply chain pressures (at least to some extent).”

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