On their return to action after Monday’s holiday, US stocks are poised to advance as markets open. Better than expected fourth-quarter 2014 growth data for China should support positive investor sentiment. And hopes remain high that the European Central Bank will announce fresh stimulus measures on Thursday – that should provide further encouragement for investors.
Late morning futures indicate that the Dow Jones will gain around 50 points at open to 17,484, with the S&P 500 ahead 7.5 points to 2,020. Nasdaq is seen advancing around 25 points to 4,155.
1. China and IMF growth updates to be digested before kick-off
Before the opening bell in New York, investors will be ploughing through 2014 GDP data for China, and the IMF’s updated global growth forecasts.
As we noted this morning, official Beijing data shows the Chinese economy over 2014 notched up its weakest annual growth for 24 years, and missed its official annual target of 7.5% growth for the first time in 15 years.
But investors in Europe this morning took some comfort from a better than expected growth reading of 7.3% for the final quarter of 2014. That positive spin on the China data will probably spill over into New York this afternoon, with investors shrugging off the weakest annual growth for 24 years for this year and next.
2. Focus on fourth-quarter earnings
Investment bank Morgan Stanley and healthcare giant Johnson & Johnson are on the fourth-quarter runway, with both forecast to report higher earnings and revenue.
Video streaming group Netflix will also be in sharp focus. It has had a pretty tough time over the last six months, with the shares giving up 25% on concerns about slowing domestic user growth. Investors will be hoping the company announces plans to tackle fresh markets. There have been rumours recently that it plans an expansion into Asia.
3. Google eyes final frontier
The Wall Street Journal reported after hours yesterday that Google is close to investing about $1bn in Space Exploration Technology Corp (Space X) to support its effort to deliver Internet access via satellites.
Space X is backed by Tesla Motors chief, Elon Musk. If Google goes ahead with the investment, it would value Space X at more than $10bn.
4. Twitter snaps up Indian mobile marketing expert
Twitter has acquired Indian mobile marketing company ZipDial for an estimated $30m-$40m. The Bangalore-based company has capitalised on a local tradition of communicating through ‘missed calls’ – a method of signalling without incurring charges. It can be used by a person, for instance, to alert a friend that he or she has arrived at a particular destination.
Forbes explains that ZipDial’s commercial take on the ‘missed call’ tradition involves assigning companies a special phone number for use in print ads or TV commercials. Customers can call the number and hang up before they are charged for the call. In turn, brands can phone or send promotional text messages about their business to the ‘missed callers’.
ZipDial’s clients include Unilever, Disney, Gillette, Amazon, and Facebook, as well as Twitter.