US futures fall as investors react to Netflix and IBM earnings
US futures declined slightly as investors continued to digest corporate earnings. IBM and Netflix released their earnings after the market close. IBM came up short of analysts’ consensus. Earnings came in at $2.68 a share on revenue of more than $18 billion. This was a 3.9 per cent decline from the same quarter a year ago. The company blamed weak results on business divestitures, foreign currency issues and a decline in IT spending by companies.
Meanwhile, Netflix stock rose in aftermarket trading after it released its earnings. Earnings came in at $1.47 on revenues of $5.25 billion. The company added more than 6.77 million net subscribers, which was below its guidance of 7 million.
The Australian dollar rose in the Asian session after the country released mixed employment data. In September, the unemployment rate declined to 5.2%. This was a better number than the previous 5.3%. The full employment change in September was 26.2k, which was better than the previous decline of 15.5k. Employment change of 14.7k was lower than August’s rise of 34.7k. These numbers come at a time when the Central Bank has slashed interest rates by 75 basis points. In minutes released this week, members said that they had started to see an improvement in the economy.
Sterling remained at an elevated level as EU and UK negotiators continued to wrangle over terms of a deal. In the UK, Boris Johnson was trying to find support from North Ireland Democratic Party and Eurosceptic Members of Parliament. Johnson’s deal will introduce customs and a regulatory border between Northern Ireland and the rest of the UK. According to sources, a deal has not been announced yet because DUP members have continued to have their reservations. Another concern about Johnson’s deal is its impact on Scotland, which voted remain. Scotland could ask to be allowed to remain in the customs union. Later today, traders will receive retail sales data from the UK. Other key data to watch out for today will be housing starts and manufacturing data from the US and crude oil inventories by EIA.
The AUD/USD pair rose sharply after Australia released its employment numbers. The pair rose from a low of 0.6750 to a high of 0.6790. On the hourly chart, the pair is trading along the upper line of the Bollinger Bands while RSI has moved to the overbought zone. The momentum indicator has soared too. The pair might move higher to test the important resistance level of 0.6800.
The EUR/USD pair was relatively unchanged in the Asian session. As of this writing, the pair is trading at 1.1076, which is slightly lower than the previous high of 1.1085. On the hourly chart, this price is higher than the 14-day and 28-day moving averages while RSI has remained slightly lower than the overbought level of 70. The histogram and signal line of MACD are at the highest level since October 10. The pair may remain along this range ahead of the US housing data.
The GBP/USD pair remained at a multi-month high as the market waited for more information on Brexit. As of this writing, the pair is trading at 1.2820, which is slightly lower than yesterday’s high of 1.2800. On the hourly chart, the RSI remains above the overbought level while the price is above all short and medium-term moving averages. There is a possibility that the pair will move lower, which is confirmed by the weakening average directional index that has been falling.