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Ferrari offers Wall Street a distraction, major earnings ahead

U.S. stock index futures indicated a higher open on Wednesday, with investor's looking to Ferrari's first day of trading and a fresh slew of corporate earnings reports.

Traders took in earnings reports from Kimberly-Clark, Boeing, General Motors and Coca-Cola before the bell, among others.

American Express, eBay, Texas Instruments, Tractor Supply, Fortune Brands, Kinder Morgan, Morningstar and Sallie Mae report after the close.

Ferrari begins trading Wednesday after its initial public offering priced at $52, the top of the range Tuesday. The luxury sports carmaker has found plenty of interest in the 9 percent stake it offered, versus other companies' offerings that have been priced on the weak side.

"By way of a bit of background, 46 years ago in 1969 Fiat-Chrysler bought a 50 percent stake in Ferrari which it then increased to 90 percent in 1988," said chief market analyst at CMC Markets, Michael Hewson.

Traders work on the floor of the New York Stock Exchange.
Lucas Jackson | Reuters
Traders work on the floor of the New York Stock Exchange.

"The company hopes to sell 9 percent of that stake, which amounts to around 17.2m shares on the open market at $52 a share, at the top end of the price range, which would value the company in the region of $10 billion and raise about $895 million," he said.

Both Nordstrom and Albertsons delayed their IPOs in the past week, and First Data went ahead with its big IPO though its stock is trading under the $16 offer price.

While S&P 500 companies are mostly beating on the bottom line, 60 percent have seen weaker revenue growth. Profits are expected to decline by about 4 percent this quarter, according to Thomson Reuters.

On the data front, no key releases are scheduled for Wednesday.

In Europe, stocks were slightly higher as investors look ahead to a meeting of the European Central Bank (ECB) on Thursday and digested a slew of mixed earnings.

Asian stocks diverged on Wednesday, with China posting its worst one-day performance in five weeks after being hit by a sudden bout of selling in small-caps in the afternoon session.

The key Shanghai Composite index fell as much as 4.6 percent to 3,265.4 — its lowest level since August 21 — before clawing back up to eventually finish Wednesday 3.5 percent lower.