Here are five things you must know for Friday, Jan. 4:
1. -- Stocks Steady Ahead of Jobs Report, Powell Speech
U.S. stock futures rose on Friday, Jan. 4, and global shares steadied as planned trade talks between Washington and Beijing acted as a catalyst for a modest rebound in risk sentiment, while investors prepped for the U.S. jobs report for December and what could be a game-changing speech from Federal Reserve Chairman Jerome Powell.
Contracts tied to the Dow Jones Industrial Average jumped 296 points, futures for the S&P 500 were up 34.25 points, and Nasdaq futures gained 109 points. The rebound followed a drubbing for U.S. stocks on Thursday following a sales warning from Apple Inc. (AAPL) - Get Report and a weak report on U.S. manufacturing. The Dow on Thursday fell 660 points, or 2.83%, to 22,686, the S&P sank 2.48% and the Nasdaq dropped more than 3%.
China's Commerce Ministry said Friday that Deputy U.S. Trade Representative Jeffrey Gerrish will visit Beijing next week for two days of high-level trade talks as the damaging dispute continued to take its toll on the the U.S. and China, both of which recorded notable manufacturing slowdowns at the end of 2018.
On Friday, China's central bank said it would reduce the ratio of cash to loans that domestic lenders need to hold on their balance sheets, a move that will add around $220 billion to the nation's financial system as officials attempt to re-ignite growth in the world's second-largest economy.
The U.S. nonfarm payrolls report for December is expected to show that U.S. employers added 180,000 new jobs last month and the unemployment rate held steady at a 49-year low of 3.7%. Average hourly earnings are forecast to rise 0.3% in December from 0.2% in November.
Any upward surprise in the report, especially with respect to wages, could cement the Federal Reserve's signaling of two further rate hikes in 2019.
Powell is expected to take part in a panel discussion Friday on monetary policy and central banking at the American Economic Association in Atlanta at 10:15 a.m. ET. Janet Yellen and Ben Bernanke, former Fed chiefs, also are expected to attend.
The economic calendar in the U.S. on Friday also includes the PMI Services Index for December at 9:45 a.m.
2. -- House Passes Bill to End Government Shutdown
Democrats in the House of Representatives passed a spending package Thursday designed to end the federal government shutdown but rejected Donald Trump's demand for additional money for a border wall between the U.S. and Mexico.
The House voted 241-190 for a deal that includes several spending bills designed to fund most of the federal government through September. Democrats also passed a stopgap spending bill funding the Department of Homeland Security, which oversees the wall, through Feb. 8.
The legislation to re-open the U.S. government is expected to be stalled in the Senate, and lawmakers indicated that the partial shutdown was likely to drag on, with neither Democrats nor Trump ready to back down.
Trump and congressional leaders were expected to meet again Friday to resume discussions. Trump already has said he would veto the House Democratic plan.
The government shutdown entered its 14th day on Friday.
3. -- Apple Rebounds Slightly After Revenue Warning Sinks the Stock
Apple Inc. (AAPL) - Get Report rose 1.3% in premarket trading Friday but was making up little ground following the stock's 10% plunge on Thursday after the iPhone maker issued its first revenue warning in 12 years.
TheStreet's Eric Jhonsa said perhaps an iPhone sales stumble was necessary to fully appreciate the size of Apple's smartphone franchise, and how dependent even a company with Apple's reach remains on the business for now.
Though Apple said in its sales warning that its non-iPhone businesses -- everything from Macs and iPads, to Apple Watches and AirPods, to App Store transactions and Apple Music subscriptions -- saw revenue collectively grow nearly 19% last quarter, the company still believes its total revenue fell about 5%, thanks to an iPhone revenue decline that appears to be around 15%. The iPhone accounted for nearly 70% of Apple's revenue in the December 2017 quarter, and it looks as if it accounted for about 62% of revenue in the December 2018 quarter, according to Jhonsa.
TheStreet's Annie Gaus said people have been holding onto their phones longer than they used to - and that's increasingly becoming a problem for Apple.
Apple CEO Tim Cook hinted at a trend that's been on the rise for years in the smartphone industry: People just aren't upgrading their phones as frequently as they once did. In a letter to investors, Cook wrote that "in some developed markets, iPhone upgrades also were not as strong as we thought they would be," and cited factors like fewer carrier subsidies and high prices tied to the strength of the U.S. dollar.
But consumers have been buying new phones less frequently for some time, wrote Gaus. According to Hyla Mobile, which runs a phone trade-in program and tracks the life cycles of smartphones, consumers held on to their iPhones for an average of 2.89 years as of last quarter. That's a notable increase from 2.39 years in the last quarter of 2016.
4. -- Tesla to Begin Delivering Model 3 Cars to China in March
Tesla Inc. (TSLA) - Get Reportplans to start delivering Model 3 cars to customers in China in March, Reuters reported.
The electric vehicle company, which seeks to boost sales in China that have been hit hard by the impact of trade tensions between Washington and Beijing, said in a statement the starting price for a Model 3 in China would be 499,000 yuan ($72,000).
Tesla cut prices for its Model 3 last month, the third time in the last two months the company adjusted prices in China, Reuters noted.
The stock rose 2.1% in premarket trading. Tesla shares have declined about 10% so far in 2019.
5. -- Herb Kelleher, Founder of Southwest, Dies
Kelleher became Southwest's chairman in 1978 and CEO in 1982, and led the airline through its period of greatest growth.
In a statement Thursday, Southwest said, "Herb was a pioneer, a maverick, and an innovator. His vision revolutionized commercial aviation and democratized the skies."