Bloomberg Business
-Fed reaction: Emerging markets advanced in the aftermath of yesterday’s Fed statement which acknowledged global risks, reassuring investors that the pace of rate hikes could be slow. The Europe Stoxx 600 was 0.5 percent lower at 10:55 a.m. in London following worse than expected earnings from companies and a report from the European Commission showing executive and consumer confidence fell to 105, the lowest in five months. Italian banks are also getting slammed once again. U.S. stock futures had been higher, led by the Nasdaq 100 following stellar Facebook earnings, but have given up most of their gains. Facebook itself remains set for major gains.
-Japan’s economy minister resigns: Japanese Economy Minister Akira Amari resigned this morning following accusations he received money in return for favors. Amari, who spearheaded Prime Minister Shinzo Abe’s strategy to boost the nation’s competitiveness (known as “Abenomics”) is the most influential minister to step down since Abe took office in 2012. The prime minister announced the appointment of Nobuteru Ishihara, a former rival for the presidency of his party, as the nation’s new economy minister.
-Earnings: Earnings season continues apace today with Caterpillar Inc., Ford Motor Co. and Amazon.com Inc. among those due to report. Alibaba Group Holdings Ltd. is also due today, with investors watching for any insight into the health of the Chinese economy. Meanwhile in the U.S. we get initial jobless claims out at 8:30 AM ET. Economists are looking for an improvement from 293K to 281K.
-U.K. GDP: The United Kingdom economy grew for the twelfth consecutive quarter, with gross domestic product rising 0.5 percent in the fourth quarter, in line with expectations. The growth in the economy was driven by a pickup in services, which account for about 79 percent of gross domestic product. Sterling advanced following the release.
-Not guilty: In a setback to the U.K.’s Serious Fraud Office the sixth ex-broker charged in connection with the Libor-rigging scandal was acquitted this morning. This follows the acquittal of the other five brokers charged yesterday. Tom Hayes, who had his sentence reduced to 11 years in December, remains the only person convicted in relation to the scandal.
CNN Money
– Market movers — Facebook, eBay: Shareholders are celebrating Facebook’s (FB, Tech30) latest results and bidding up its shares by 12% in premarket trading. The company handily beat expectations on several key metrics, including growth of new users, sales and profit. During the last three months of 2015, Facebook brought in $5.8 billion and made $1.6 billion in profit — a whopping 123% increase from a year earlier. Meanwhile, shares in e-commerce company eBay (EBAY) are plunging 12% premarket as investors were disappointed by the firm’s fourth quarter results. Sales over the last quarter were flat compared to the same period last year.
-More earnings are coming: Another wave of companies are reporting results Thursday. Alibaba (BABA, Tech30), Caterpillar (CAT), Ford (F), Harley-Davidson (HOG), Hershey (HSY), Jetblue (JBLU), Time Warner Cable (TWC) and Under Armour (UA) are among the key companies reporting in the morning ahead of the bell. Then, after the close Wall Street will hear from Amazon (AMZN, Tech30), Microsoft (MSFT, Tech30), Electronic Arts (EA, Tech30) and Visa (V).
-Global stock market overview: U.S. stock futures are moving up, indicating markets will recover from a Fed-induced Wednesday afternoon slump. The Dow Jones industrial average dropped by 1.4%, the S&P 500 slipped 1.1% and the Nasdaq fell 2.2% after the U.S. Federal Reserve released a statement acknowledging that the U.S. economy lost momentum at the end of 2015. Despite its worries, the Fed stopped short of saying that the volatility in January will alter its plans to raise rates at least four times for the rest of 2016. Looking overseas, European markets are mixed in early trading. Chinese markets were firmly in negative territory on Thursday, but the rest of Asian markets closed with mixed results.
-Apple CEO warns of unprecedented ‘extreme conditions’: Apple just reported record profits, but it’s come with a huge warning about the economy. «We’re seeing extreme conditions unlike anything we have experienced before just about everywhere we look,» Apple CEO Tim Cook said on a call Tuesday evening with analysts. The fact that Cook was willing to be that blunt is telling. Most CEOs are optimists. For much of 2015, Cook repeatedly stressed he wasn’t seeing much of an impact from the turmoil in China and other emerging markets. Now it’s a different message. «We began to see some signs of economic softness in Greater China earlier this month, most notably in Hong Kong,» Cook admitted. China was mentioned 13 times on the Apple (AAPL, Tech30) call, a notable jump from nine times a year ago.