By Sara Sjolin, MarketWatch , Ryan Vlastelica
IBM shares decline
U.S. stock-index futures lost upward momentum on Friday, but were still set to open slightly higher, as investors braced for a looming government shutdown.
What are stock futures doing?
Futures for the Dow Jones Industrial Average shed 20 points, or 0.2%, to 25,958, while those for the S&P 500 index climbed 3.30 points, or 0.1%, to 2,799.50. Futures for the Nasdaq-100 Index gained 20 points, or 0.3%, to 6,833.25, led by a 1.3% premarket advance for NVIDIA Corp. (>> NVIDIA Corporation).
The indicated gains on Friday come after U.S. stocks ended lower on Thursday , falling from all-time closing highs hit on Wednesday. The Dow average ended 0.4% lower on Thursday, while the S&P 500 index fell 0.2% and the Nasdaq Composite Index slipped 0.03%.
For the week, the Dow is poised to gain 0.8%, while the S&P 500 is set to rise 0.4% and the Nasdaq 0.5%, with Friday's session to go.
Even with the uncertain political backdrop, stocks have been able to continue their march higher in 2018. The S&P 500 is up 4.7% this month, while the other major benchmarks have jumped more than 5%. The solid start to the new year comes on signs economic growth remains strong and corporate earnings are picking up.
What are other markets doing?
Dollar investors, however, were more spooked by the shutdown uncertainty on Friday. The ICE U.S. Dollar index was down 0.1% at 90.350 .
Oil prices also slumped , staying lower after the International Energy Agency said shale producers would help drive U.S. production to levels not seen since the 1970s.
Gold prices (>> Guardian Capital Group Ltd.) rose, getting a boost from the weaker dollar.
Asian stock markets closed mainly higher , inspiring an upbeat session in Europe as well.
What are strategists saying?
"I would characterize a shutdown as just the kind of political news that the market has demonstrated, over the past year, a willingness to ignore," said Hank Smith, co-chief investment officer at Haverford Trust, which manages $8 billion. He said that "the market is reacting to GDP growth both here and abroad, and corporate profits, which are growing by double-digit rates and are healthy, interest rates that remain low despite a gradual uptick, and benign inflation."
Boris Schlossberg, managing director of FX strategy, in a Friday note, said: "The government shutdown per se may not have much economic impact on the U.S. economy, but the specter of uncertainty that it could spread through the general economy could dent investor sentiment especially if the drama in DC turns into a protracted battle of the wills."
Which stocks are in focus?
Shares of International Business Machines Corp.(>> International Business Machines Corporation) dropped more than 3% premarket after the tech company late Thursday reported a fourth-quarter loss due to a $5.5 billion one-off charge from the recently-passed tax legislation.
American Express Co.(>> American Express Company) fell 2.9% ahead of the open. The credit card company late Thursday recorded its first quarterly loss in over a quarter-century and said it would suspend its share buy backs in response to a hit from the corporate tax cut.
Shares of Acorda Therapeutics Inc. (>> Acorda Therapeutics Inc), were climbing on reports that it was closing in on a buyer (https://seekingalpha.com/news/3323826-potential-suitors-eyeing-acorda-therapeutics-shares-ahead-9-percent-premarket). Shares of the drugmaker were up around 15%.
Shares of Square Inc. (>> Square Inc) rose 5.2% in premarket trading Friday after analysts at Instinet raised their target price to $64, by far the highest among Wall Street analysts tracked by FactSet.
Travel retailer Hudson Ltd. (>> Hudson Resources Inc.) set the terms for its planned initial public offering on Friday , saying it will offer 34.9 million shares priced at $19 to $21 each.
What's on the economic calendar?
At 10 a.m., Eastern consumer sentiment for January is slated for release.
Atlanta Federal Reserve President Raphael Bostic was set to appear in a moderated discussion about the economy at the Nashville regional Fed branch at 8:15 a.m.
Federal Reserve Vice Chair Randall Quarles will speak on bank regulation to the American Bar Association in Washington at 1 p.m.
What is driving the markets?
The House on Thursday passed a one-month spending bill that would keep the government funded through Feb. 16, but the stopgap measure currently doesn't have enough support to clear the Senate. The current interim funding bill that was passed in December expires at 12:01 a.m. Eastern Time, on Saturday.
The Senate adjourned without a final vote late on Thursday and will reconvene at 11 a.m. Eastern Time on Friday.