Here are five things you must know for Wednesday, April 3:
1. -- Stocks Higher as U.S.-China Trade Deal Said '90%' Done
U.S. stock futures were higher on Wednesday and global stocks rose on reports of a breakthrough in trade talks between Washington and Beijing.
White House economic advisor Larry Kudlow told the U.S. Chamber of Commerce on Tuesday that a "larger, grander discussion" on trade was taking place with China and that the U.S. expects to make "more headway" in talks with Vice Premier Liu He later this week in Washington.
"We're getting into the end-game stage," said Myron Brilliant, executive vice president for international affairs at the U.S. Chamber of Commerce, the Financial Times reported. "Ninety percent of the deal is done, but the last 10% is the hardest part, it's the trickiest part and it will require trade-offs on both sides."
Contracts tied to the Dow Jones Industrial Average rose 115 points, futures for the S&P 500 gained 15 points, and Nasdaq futures were up 46.75 points.
Global oil prices also were rising for a fourth consecutive session, taking Brent crude to within a few pennies of $70 a barrel, a level last seen in early November, as data showed OPEC production levels hitting a four-month low.
The economic calendar in the U.S. Wednesday includes the ADP National Employment Report for March at 8:15 a.m. ET, the PMI Services Index for March at 9:45 a.m., the ISM Non-Manufacturing Index for March at 10 a.m., and Oil Inventories for the week ended March 29, at 10:30 a.m.
2. -- Caterpillar Slides as Analyst Downgrades the Stock to 'Hold'
Caterpillar (CAT - Get Report) declined in premarket trading Wednesday after analysts at Deutsche Bank cut their rating on the stock amid concerns the industrial equipment maker's order book could register negative growth over the near term as the global economy slows.
Deutsche Bank analyst Chad Dillard Dillard cut his rating on the shares to hold from buy with a $128 price target, and said that if order backlog growth turns negative it normally precedes a negative earnings revision cycle by around three months. That typically sees analysts trimming estimates by as much as 45%, triggering sharp share price declines, Dillard said.
"Synchronized global growth has collapsed, the China Land Cycle is rolling over (and will continue to weaken despite the single positive data point this week)," Dillard wrote. "Europe is slowing more than expected and the U.S. is over-saturated with construction equipment."
Caterpillar shares fell 0.9% in premarket trading to $138.99. The stock has risen 10.3% year to date.
3 -- GameStop Falls on Weak Earnings, Weak Guidance
GameStop (GME - Get Report) shares tumbled in premarket trading Wednesday after the video game retailer badly missed fourth-quarter earnings estimates and issued weak guidance.
GameStop posted adjusted fourth-quarter earnings of $1.45 a share on revenue of $3.06 billion, below analysts' profit expectations of $1.60 a share on revenue of $3.28 billion.
"As we think about 2019 and beyond, we recognize the challenges facing our pre-owned video game business and are prepared to address them as we continue to evolve our business model going forward," Chief Operating Officer Rob Lloyd said in a press release. "Importantly, we will continue to leverage our powerful brand to drive growth and, with a new cost savings and profit improvement initiative in place, we will focus our efforts on driving profitability."
For the year, three of the company's six business segments experienced revenue declines. New hardware sales fell 1.3% and new software sales declined 5.1%. The company's pre-owned games sales dropped 13.2%.
For the coming fiscal year, the company expects total sales, as well as same-store sales, to fall between 5% and 10%. GameStop said it expects losses in the first fiscal quarter of up to 5 cents a share.
GameStop fell 11.9% in premarket trading to $8.90.
4. -- Dave & Buster's Rises Sharply on Earnings Beat
Dave & Buster's Entertainment (PLAY - Get Report) rose sharply in premarket trading after the arcade and restaurant chain reported fourth-quarter adjusted earnings of 66 cents a share on revenue of $331.8 million, beating analysts' forecasts on both metrics.
Same-store sales in the period rose 2.9%, higher than analysts' forecasts of 2.2%. Sales jumped, in part, on a new virtual reality game platform leveraging movies series such as "Men in Black" and "Star Trek."
"We are pleased to finish the year on a strong note. On a comparable-week basis, we drove double-digit revenue growth in Q4 as comparable-store sales increased 2.9% and new store performance remained strong," said CEO Brian Jenkins.
Looking into 2019, Dave & Buster's said it expects operating earnings in the region of $285 million to $300 million from revenue that could rise to $1.4 billion over the fiscal year. The company plans to open between 15 and 16 new locations, with a capital spending allocation of $200 million, while forecasting comparable-store sales that would be flat to around 1.5% higher than fiscal 2018.
The stock rose 6.8% in premarket trading to $53.90.
5. -- Intel Names Qualcomm's George Davis as Finance Chief
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