(Monday Pre-Market) The US stock market remains tethered to oil but Friday's action offered another gentle reminder: global stock and economic moves reach US shores quickly. Watch for continued attention on Asian economies and markets, and those of other global giants, in coming sessions.
Friday's story centered on a surprise move from the Bank of Japan, whose actions to shore up their economy touched off a global stock rally. Policymakers there surprised with a shift to negative interest rates. It's the first such move in Japan's history and was meant to "pre-empt the manifestation of [downside] risk and to maintain momentum to achieve the price stability target of 2%," members said in a statement released after a two-day policy meeting. "We will cut the interest further into negative territory if judged as necessary," the central bank said.
It's one more wrinkle for a Federal Reserve that has been leaning the other way--toward removing loose interest rate policy in the US For traders, it could become increasingly important to sift through Fed speeches for clues about how future Fed policy could fit in with a global aim to keep a slowing economy from eroding too quickly. The Fed next takes up interest rate policy in March. It raised its key short-term lending benchmark in December for the first time in nearly a decade.Don't Forget Earnings
Part of Friday's broad-market boost came courtesy of Microsoft's (MSFT) earnings beat. It was a nice reminder that stock-by-stock and sector-by-sector trading still matters even if macroeconomic themes seem to dominate.
The earnings parade stretches into a new week, with big energy and pharmaceutical names among those slated to report. Exxon Mobil (XOM) will issue its earnings report pre-open on Tuesday. Pfizer (PFE) is due out with its results pre-open on Tuesday and Merck (MRK) reports pre-open on Wednesday. Yahoo (YHOO) and Chipotle (CMG) report post-close Tuesday, while General Motors (GM) hits the tape early Wednesday.