Market Snapshot: U.S. stock futures on pause with big bank earnings in focus

U.S. stock futures swung between small gains and losses on Friday as traders geared up for a batch of prominent bank earnings and put the trade dispute between the U.S. and China on a back burner.

What are markets doing?

Futures for the Dow Jones Industrial Average YMU8, +0.02%  rose 7 points, or less than 0.1%, to 24,899, while those for the S&P 500 index ESU8, -0.02%  climbed less than a point to 2,799 Futures for the Nasdaq-100 index NQU8, +0.01%  added 7.25 points, or 0.1%, to 7,390.

The gains come after an upbeat session on Thursday, when the Nasdaq Composite Index COMP, +1.39%  rallied 1.4% to score its first record close since June 20. The Dow DJIA, +0.91%  and the S&P 500 both ended the session 0.9% higher.

As of Thursday’s close, all three benchmarks were set for solid weekly gains, with the S&P on track for a 1.4% advance, the Nasdaq eyeing a 1.8% rally and the Dow set for a 1.9% rise for the week.

What is driving the market?

Traders appeared to be hesitant to continue Thursday’s rally, when markets rose on signs that Washington and Beijing are willing to resume trade talks, which could end in a bilateral agreement and avoid a trade war.

Trade was still in focus on Friday, but investors diverted their attention to the second-quarter earnings season that is due to kick off in earnest before the bell. JPMorgan Chase & Co. JPM, +0.43%  reported earnings that were better than had been forecast, sending the shares up 1.4% ahead of the bell.

Major banks Citigroup Inc. C, +0.88%  and Wells Fargo & Co. WFC, -0.07%  are also scheduled to report results early.

Read: Bank earnings are expected to shine, but their stocks may not

On the political front, U.S. President Donald Trump was set to meet Britain’s Queen Elizabeth II on Friday. The president arrived in the U.K. on Thursday and in a bombshell interview with the Sun newspaper criticized British Prime Minister Theresa May. Trump said May’s plans for a “soft” Brexit would “kill” any potential trade deal between the U.S. and the U.K.

Crowds were gathering in London on Friday morning to hold protests, including a march and rally, against the president’s visit to the U.K.

What are analysts saying?

“With U.S. earning season starting and expectations running high, traders have effortlessly switched their focus back onto fundamental drivers of the market and away from political headlines. The robust U.S. economy, high consumer confidence and low borrowing rates provide a solid backdrop for some impressive figures, and that is before we draw in the benefits of the Trumps tax cuts,” said Jasper Lawler, head of research at London Capital Group, in a note.

What’s new in economics?

The import-price index for June is due at 8:30 a.m. Eastern Time, followed by the consumer sentiment index for July at 10 a.m.

At 11 a.m., the Fed will releases its July 2018 monetary policy report to Congress. Atlanta Fed President Raphael Bostic is scheduled to appear in a moderated discussion at Virginia CPA Society at UVA North Virginia Center in Falls Church at 12:30 p.m. Eastern.

See: MarketWatch’s economic calendar

Stock movers

Shares of Johnson & Johnson JNJ, +1.20%  dropped 2.7% ahead of the bell after the pharma company late Thursday was ordered to pay $4.69 billion in damages in a lawsuit linking baby powder to cancer.

AT&T Inc. T, +1.13%  declined 1.6% before Friday’s open after the Department of Justice late Thursday filed for an appeal of a ruling allowing the telecoms major to acquire Time Warner Inc.

What are other markets doing?

Asian stock markets closed mainly higher, but with the Shanghai Composite Index SHCOMP, -0.23%  ended lower after data showed Chinese imports grew less than expected in June. In Europe, equities were also on the rise and heading for weekly advances.

Crude oil prices CLQ8, -0.17%  fell 0.3% to $70.14 a barrel, while gold GCQ8, -0.51%  dropped 0.5% to $1,240.70 an ounce. The ICE Dollar Index DXY, +0.36%  climbed 0.4% to 95.194.

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