US STOCKS-Wall Street set to open flat with Alphabet results on tap

  • Reuters
  • Stock Market News
US STOCKS-Wall Street set to open flat with Alphabet results on tap
Credit: © Reuters.

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* Ultimate Software jumps on $11 bln buyout deal

* Papa John's gains on $200 mln investment

* Alphabet (NASDAQ: GOOGL ) rises ahead of results skedded after-market

* Futures down: Dow 0.04 pct, S&P 0.05 pct, Nasdaq 0.08 pct (Adds comment, details; Updates prices)

By Medha Singh

Feb 4 (Reuters) - Wall Street was set to open flat on Monday as investors took a wait-and-see stance after an earnings-heavy week which included strong U.S. jobs growth data, with Alphabet's results expected after the bell.

Alphabet Inc GOOG.O rose 0.4 percent in premarket trading, and its results will round up earnings from the so-called FAANG group.

The reports have been a mixed bag, with Apple Inc AAPL.O and Facebook Inc FB.O posting better-than-expected quarterly results last week, while Netflix Inc NFLX.O and Amazon.com Inc (NASDAQ: AMZN ) gave downbeat current-quarter forecasts.

Still, the indexes held onto their two-month levels, as recent signs of progress in U.S.-China trade talks and the Federal Reserve's signal of slowing down rate hikes led to a collective sigh of relief among investors who have fretted over growth.

"We are set for a breather week," said Michael Antonelli, managing director, institutional sales trading at Robert W. Baird in Milwaukee.

"We've got the real big February catalyst out of the way and that was the Fed meeting, now we're looking for what the rest of the earnings has."

A nonfarm payrolls report on Friday showed U.S. job growth surged the most in 11 months in January. But concerns remained that a slowdown in the rest of the world could hurt U.S. earnings, with warnings from bellwethers including Caterpillar Inc (NYSE: CAT ) CAT.N .

Nearly half of the S&P 500 companies that have reported fourth-quarter earnings so far, 70.9 percent beat analysts' expectations, below the last four quarters' average of 78 percent, according to Refinitiv data.

Since the earnings kicked off three weeks ago, analysts' estimates for fourth-quarter profit growth has risen to 15.5 percent from 14.3 percent, but expectations for 2019 earnings growth fell to 4.9 percent from 6.3 percent.

At 8:35 a.m. ET, Dow e-minis 1YMc1 were down 11 points, or 0.04 percent. S&P 500 e-minis ESc1 were down 1.25 points, or 0.05 percent and Nasdaq 100 e-minis NQc1 were down 5.75 points, or 0.08 percent.

In a bright spot, Ultimate Software Group Inc ULTI.O surged 19 percent after the HR software provider agreed to be bought by an investor group led by Hellman & Friedman in a $11 billion deal. John's International Inc PZZA.O jumped 4.7 percent after a $200 million investment by hedge fund Starboard Value LP. Sciences Inc GILD.O dipped 0.5 percent ahead of its fourth-quarter earnings expected after the bell.

Last week the U.S. central bank in a sharp reversal of stance from six weeks ago, pledged to be patient with further interest rate hikes. In light of this, Fed Chairman Jerome Powell's speech on Wednesday will be closely watched.

Also in focus will be data at 10:00 a.m. ET which is expected to show factory orders rose 0.2 percent in November compared with the 2.1 percent fall in the prior month.

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