Dow futures rise 135 pts; Bank of America earnings boost sentiment

By Peter Nurse    

Investing.com -- U.S. stocks are seen opening with gains Tuesday, with investors boosted by healthy earnings from Bank of America, continuing the run of U.S. big banks topping estimates. 

At 07:05 ET (11:05 GMT), the Dow Futures contract was up 135 points, or 0.4%, S&P 500 Futures traded 18 points, or 0.4%, higher and Nasdaq 100 Futures climbed 80 points, or 0.6%.

The main indices closed higher Monday as the banking sector’s quarterly earnings continued, with Charles Schwab (NYSE:SCHW) beating expectations but reporting an 11% drop in deposits from the fourth quarter, underscoring the trend of depositors moving their assets to the largest, seemingly more secure, banks.

The blue chip Dow Jones Industrial Average closed 100 points, or 0.3% higher, while both the broad-based S&P 500 and the tech-heavy Nasdaq Composite also gained 0.3%.

Bank of America (NYSE:BAC) followed the path set by JPMorgan (NYSE:JPM), Citigroup (NYSE:C) and Wells Fargo (NYSE:WFC) last week, and released strong quarterly earnings, earning more from customers' interest payments while the Federal Reserve raised borrowing costs. Goldman Sachs (NYSE:GS) is also due to release its numbers before the open Tuesday.

Pharma giant Johnson&Johnson (NYSE:JNJ) is also scheduled to report, but the day’s highlight is likely to come after the close, in the form of quarterly results from streaming giant Netflix (NASDAQ:NFLX). 

The focus will also be on subscriber numbers, and the company is expected to have added some 2 million subscribers in the first quarter. 

Aside from the corporate sector, investors will also be keeping an eye on the real estate market, with March economic data in the form of housing starts and building permits due, while FOMC member Michelle Bowman is also scheduled to speak later in the session.

Oil prices edged lower Friday, with traders taking profits after recent gains despite strong Chinese economic growth data pointing to the likelihood of additional crude demand later this year from the largest oil importer in the world.

China’s GDP grew 4.5% in the first quarter, above the 4.0% expected, while the country’s refiners processed 63.29 million tons of crude in March, up 8.8% on a yearly basis and the highest ever for that particular month.

By 07:05 ET, U.S. crude futures traded 0.1% lower at $80.75 a barrel, while the Brent contract dropped 0.1% to $84.72. Both benchmarks are up over 16% this month.

Additionally, gold futures rose 0.4% to $2015.85/oz, while EUR/USD traded 0.5% higher at 1.0978.