Dow Jones futures fell sharply early Friday, along with S&P 500 futures and Nasdaq futures, as weak China and European data added to global growth fears. Adobe (ADBE), Starbucks (SBUX) and Costco Wholesale (COST), all near buy points, fell early Friday. Adobe earnings topped, but guidance was light. Starbucks cut its long-term growth target. Costco earnings missed. Adobe stock boasts a best-possible 99 IBD Composite Rating. Starbucks stock has a 97 Composite Rating, while Costco stock has a good-not-great 88 CR.
XDow Jones Futures Today
Dow Jones futures fell 1% vs. fair value. S&P 500 futures sank 1.1%. Nasdaq 100 futures slid 1.3%. The major indexes are in danger of wiping the week's modest gains.
China's Shanghai composite lost 1.5% and Japan's Nikkei 2%, with European markets also losing significant ground.
China Data, European Data Add To Global Growth Fears
China industrial production rose 5.4% vs. a year earlier in November, while retail sales grew 8.1%, both missing views and the weakest in years. Meanwhile, European auto sales fell again. A eurozone purchasing managers index hit a multiyear low, exacerbated by France's recent yellow-vest protests.
China early Friday suspended additional tariffs on U.S. autos and auto parts for three months, bringing it down from 40% to 15%. Tesla (TSLA) slashed Chinese prices for its cars immediately. However, the China auto tariffs cut had been expected and did lift Dow futures. Tesla stock fell 0.9% before the open after closing above a buy range Thursday.
Remember that overnight action in Dow futures, Adobe stock and elsewhere doesn't necessarily translate into actual trading in the next regular session. That's been particularly true in recent weeks, as Dow Jones futures swing up and down followed by volatile market action the next day.
In Thursday's stock market, a morning rally quickly faded. The Dow Jones rose 0.3%, but the S&P 500 index closed just below break-even and the Nasdaq composite lost 0.4%.
Adobe Earnings
Adobe earnings and revenue topped fiscal fourth-quarter estimates late Thursday. But the digital media and marketing software firm gave weak Q1 and full-year 2019 earnings guidance.
Adobe stock fell 2% early Friday. Shares rose 1% Thursday to 248.08. Adobe stock is close to a handle buy point of 260.82 and is just above its 50-day and 200-day lines.
The relative strength line, which tracks a stock's performance vs. the S&P 500 index, is already hitting new highs, a bullish sign.
Adobe stock is on the IBD 50 list.
Starbucks Earnings
The Starbucks earnings target of at least 10% non-GAAP growth is below prior forecasts for 12% or more. Starbucks also sees long-term same-store sales growth in China of 1%-3%.
Starbucks stock fell 3.5% early Friday. On Thursday, shares rose 1.2% to 66.91, as the company outlined several initiatives, including alliances with UberEats and Alibaba (BABA).
Starbucks stock is working on a flat base after running up in early November following the last Starbucks earnings report. Assuming shares hold in the recent range for one more day, Starbucks stock will have a new 69.08 buy point.
Starbucks has been an IBD Leaderboard stock for several weeks.
Costco Earnings
Costco earnings missed by a penny. Revenue rose 10%, topping views. Costco stock fell 3.3% early.
Shares have been hitting resistance at their 50-day line, closing down 0.6% to 226.51. But the RS line is right at record highs.
Cisco stock is in a flat base with a 245.26 flat-base buy point.
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