Upbeat Earnings News May Lead To Initial Strength On Wall Street

(RTTNews) - The major U.S. index futures are currently pointing to a higher open on Wednesday, with stocks likely to move to the upside after ending yesterday's volatile session mixed.

A positive reaction to earnings news from financial giants Bank of America (BAC) and Morgan Stanley (MS) may contribute to initial strength on Wall Street.

Shares of Bank of America are surging by 4.1 percent in pre-market trading after the company reported third quarter results that exceeded analyst estimates on both the top and bottom lines.

Investment banking giant Morgan Stanley (MS) is also jumping by 3.9 percent in pre-market trading after reporting better than expected third quarter results.

U.S.-listed shares of ASML (ASML) are also seeing significant pre-market strength after the Dutch semiconductor equipment maker reported mixed third quarter results but said it expects 2026 total net sales to exceed 2025.

On the other hand, shares of Abbot Abbott Laboratories (ABT) may come under pressure after the healthcare company reported weaker than expected third quarter revenues.

Traders are also likely to keep an eye on any comments from President Donald Trump about U.S. trade with China, which have been a key driver of market sentiment in recent sessions.

Following the notable rebound seen during Monday's session, stocks saw substantial volatility over the course of the trading day on Tuesday. The major averages recovered from a significant early pullback only to once again come under pressure late in the session.

The major averages eventually ended the session mixed. While the Dow climbed 202.88 points or 0.4 percent to 46,270.46 after plunging more than 600 points in early trading, the S&P 500 dipped 10.41 points or 0.2 percent to 6,644.31 and the Nasdaq slid 172.91 points or 0.8 percent to 22,521.70.

The late-day pullback on Wall Street came as a post by President Donald Trump on social media platform Truth Social reinforced earlier concerns about trade tensions between the U.S. and China.

Trump accused China of an "economically hostile act" by purposefully not buying U.S. soybeans and threatened to terminate business with China having to do with cooking oil and other elements of trade as retribution.

Stocks also came amid under pressure early in the session amid concerns about U.S.-China trade tensions after Trump's more conciliatory post about China helped trigger the substantial rebound on Monday.

Asked about the dispute over China's expansion of export controls on rare earths, a spokesperson for China's Ministry of Commerce suggested the country was only responding to Washington's restrictions on Chinese firms.

"The U.S. has long overstated national security, abused export controls, and adopted discriminatory practices against China," the spokesperson said, according to Google translate.

They added, "In particular, since the Madrid trade talks between China and the U.S., the U.S. has continued to impose a series of new restrictive measures on China, which have seriously harmed China's interests and seriously undermined the atmosphere of the bilateral trade talks."

The spokesperson reiterated that China is willing to "fight to the end" if there is a trade war but said the "door is open" to trade talks.

Beijing has also announced sanctions against five U.S.-based subsidiaries of South Korean shipping giant Hanwha Ocean, accusing the firm of cooperating with Washington in its curbs on China's maritime sector.

The early selling pressure was partly offset by upbeat news from big-name financial companies, contributing to the recovery attempt.

Shares of Wells Fargo (WFC) spiked by 7.2 percent after the financial giant reported better than expected third quarter results and raised its profitability target.

Citigroup (C) also surged by 3.9 percent after reporting third quarter results that exceeded estimates, although JPMorgan Chase (JPM) moved notably lower despite reporting better than expected third quarter results.

Airline stocks moved sharply higher over the course of the session, with the NYSE Arca Airline Index soaring by 4.2 percent.

Substantial strength was also visible among housing stocks, as reflected by the 2.5 percent surge by the Philadelphia Housing Sector Index.

Banking, networking and telecom stocks also turned in strong performances on the day, while significant weakness among semiconductor and computer hardware stocks re-emerged in late-day trading.

Commodity, Currency Markets

Crude oil futures are climbing $0.44 to $59.14 a barrel after falling $0.79 to $58.70 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $4,198, up $34.60 compared to the previous session's close of $4,163.40. On Tuesday, gold jumped $30.40.

On the currency front, the U.S. dollar is trading at 151.58 yen compared to the 151.83 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1622 compared to yesterday's $1.1605.

Asia

Asian stocks rose broadly on Wednesday, snapping three days of losses as optimism that the U.S Federal Reserve may go for further interest rate cuts outweighed renewed U.S.-China trade tensions.

Citing job-market weakness, Fed Chair Jerome Powell on Tuesday indicated a likely interest rate reduction this month.

Chinese markets rose sharply as new data showed China's deflation eased in September, but not quite as much as expected.

Official data showed consumer prices dropped 0.3 percent on a yearly basis in September following a 0.4 percent decrease in August. Producer prices slid 2.3 percent year-on-year, slower than the 2.9 percent decline in August.

The benchmark Shanghai Composite Index jumped 1.2 percent to 3,912.21, while Hong Kong's Hang Seng Index surged 1.8 percent to 25,910.60.

Japanese markets rebounded after falling sharply on Tuesday due to uncertainties surrounding the political situation in the country and concerns over renewed U.S.-China trade frictions.

The Nikkei 225 Index rallied 1.8 percent to 47,672.67, after having fallen 2.6 percent in the previous session. The broader Topix Index settled 1.6 percent higher at 3,183.64 as the country's first sale of government bonds since the collapse of the ruling coalition drew firm demand.

Semiconductor-related stocks rebounded, with SoftBank Group surging 5.1 percent and Advantest adding 2.2 percent.

Online retailer Mercari soared 14.2 percent after announcing it was pulling out of its on-demand employment service.

Seoul stocks soared to record high levels amid bets the Federal Reserve could end its quantitative tightening soon.

In addition, investors pinned hopes that the government's new set of measures to rein in home prices could accelerate capital inflows into the financial market.

The Kospi surged 2.7 percent to 3,657.28, with bio and tech stocks pacing the gainers. Samsung Biologics soared 9.7 percent, Samsung Electronics rallied 3.7 percent and SK Hynix advanced 2.7 percent.

Australian markets rose the most in two weeks, led by banks and mining stocks. Energy stocks moved lower, with Santos falling 2.2 percent due to weaker oil prices.

The benchmark S&P/ASX 200 Index advanced 1.0 percent to 8,990.90, while the broader All Ordinaries Index closed up 1.0 percent at 9,299.

Across the Tasman, New Zealand's benchmark S&P/NZX-50 Index edged up by 0.2 percent to 13,307.40, snapping a three-day losing streak.

Europe

European stocks are mostly higher on Wednesday, with French markets outperforming their regional peers after LVMH, the owner of Louis Vuitton and Christian Dior, unexpectedly returned to sales growth in the third quarter.

In economic news, French consumer price inflation accelerated as initially estimated in September to the highest level in eight months, the latest data from the statistical office INSEE showed.

The consumer price index climbed 1.2 percent year-over-year in September, faster than the 1.0 percent increase in the previous month. That was in line with the flash data published on September 30. Further, this was the highest inflation rate since January, when prices rose 1.7 percent.

The pan-European Stoxx 600 Index is up by 0.6 percent after falling 0.4 percent on Tuesday.

The French CAC 40 Index has surged by 2.3 percent, while the German DAX Index is up by 0.1 percent and the U.K.'s FTSE 100 Index is down by 0.3 percent.

LVMH has spiked after reporting better-than-expected sales in the third quarter, supported by an improvement in Chinese demand. Peers such as L'Oreal, Hermes and Richemont have also jumped percent.

Denmark-based Asetek has also soared after it announced a long-term agreement with an undisclosed PC gaming brand for the delivery of high-end liquid cooling products based on its Ingrid technology platform.

Electrical products distributor Rexel has also shown a strong move to the upside in Paris after reporting higher third-quarter sales.

Dutch semiconductor equipment maker ASML Holding has also surged after its orders beat analyst expectations in the third quarter.

British recruiter PageGroup has also moved sharply higher as it reported a resilient third-quarter performance despite market uncertainty.

British Land has also jumped. The property developer upgraded its forecasts for full year earnings per share growth after reporting growth in half-year profit and in portfolio and rental values.

Meanwhile, Aurubis has plunged after key shareholder Salzgitter sold 500 million euros ($582 million) worth of bonds that can be exchanged for 7.6% of the German copper producer's stock.

U.S. Economic News

New York manufacturing activity has seen a significant turnaround in the month of October, according to a report released by the Federal Reserve Bank of New York on Wednesday.

The New York Fed said its general business conditions index surged to a positive 10.7 in October after plunging to a negative 8.7 in September, with a positive reading indicating growth. Economists had expected the index to climb to a negative 1.8.

Looking ahead, the New York Fed said firms grew more optimistic about the outlook, with the future general business conditions index jumping to 30.3 in October from 14.8 in September.

The index reached its highest level since hitting 36.7 in January, as close to half of firms expect conditions to improve in the months ahead.

At 9:30 am ET, Federal Reserve Governor Stephen Miran is scheduled to participate in a conversation before the CNBC Invest in America Forum.

Atlanta Federal Reserve President Raphael Bostic is due to participate in a moderated conversation and Q&A on "Economic Mobility" before the United Way Regional Summit on Economic Mobility for Children and Youth at 12:10 pm ET.

At 12:30 pm ET, Miran is scheduled to participate in a conversation before the Nomura Research Forum.

Federal Reserve Governor Christopher Waller is due so speak on artificial intelligence at 2025 DC Fintech Week at 1 pm ET.

At 1:35 pm ET, Kansas City Federal Reserve President Jeffrey Schmid is scheduled to speak on monetary policy, the outlook and the Federal Reserve at an event hosted by the Federal Reserve Bank of Kansas City's Omaha branch.

The Federal Reserve is due to release its Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts, at 2 pm ET.