Futures Slip Ahead of Employment Report
U.S. equity futures fell in pre-market trading ahead of the
monthly Employment Situation Report. In addition, fears over the
lack of a budget deal in the U.S. kept fear high and comments
from ECB President Mario Draghi indicate the Bank is less open to
rate cuts than previously thought.
In other news around the markets:
- The Bundesbank slashed German growth forecasts for 2012 and
2013 in the wake of deteriorating European growth prospects.
The Bank expects the German economy to grow 0.7 percent in 2012
vs. 1.0 percent previously and 0.4 percent in 2013 from 1.6
- The Greek debt buyback plan is set to be complete by noon
eastern today and comments and results should be released after
- ECB President Mario Draghi said that rate cuts risk
sparking currency devaluation and widespread inflation, scaring
investors away from believing that the Bank is set to cut rates
soon. Economists have been calling for the ECB to cut rates
further to spur growth.
- S&P 500 futures fell 1.1 points to 1,411.9.
- The EUR/USD was lower at 1.2929.
- Spanish 10-year government bond yields rose to 5.536
- Italian 10-year government bond yields rose to 4.598
- Gold fell 0.21 percent to $1,698.20.
Asian shares were mixed overnight as a strong, 7.3 magnitude
earthquake rocked Japan sending shares lower. The Japanese Nikkei
Index fell 0.19 percent and the Shanghai Composite Index rose 1.6
percent while the Hang Seng Index fell 0.26 percent. In addition,
the Korean Kospi rose 0.4 percent and Australian shares rose 0.94
European shares were lower in early Friday trading as growth
fears spooked investors sending shares lower. The Spanish Ibex
Index fell 0.62 percent and the Italian MIB Index slipped 0.82
percent. Meanwhile, the German DAX fell 0.08 percent and the
French CAC slid 0.06 percent while U.K. shares fell 0.1
Commodities were mostly lower in early trade weighed down by
global growth fears. WTI Crude futures fell 0.12 percent to
$86.16 per barrel and Brent Crude futures rose 0.19 percent to
$107.23 per barrel. Copper futures did rise 0.04 percent to
$364.60 per pound as strength in Australia and China overnight
buoyed the red metal. Gold was lower and silver futures fell 0.48
percent to $32.96 per ounce.
The dollar reigned in currency market overnight against most
pairs save for the yen in a clear risk-off tone in forex markets.
The EUR/USD was lower at 1.2929 and the dollar fell against the
yen to 82.37. Overall, the Dollar Index rose to 80.419 on notable
strength against the euro, the Swiss franc, and the Swedish
krone. In addition, the Aussie dollar was weaker against the
greenback and the yen but still rose against the euro in
Stocks moving in the pre-market included:
- Comtech (NASDAQ:
) shares fell 12.67 percent pre-market as the company reported
weaker than expected earnings and lowered guidance.
- Smith & Wesson (NASDAQ:
) shares rose 2.86 percent pre-market as the company reported
better than expected earnings.
- Einstein Noah Bagels (NASDAQ:
) shares gained 7.66 percent after the company announced a
special dividend of $4 per share.
- U.S. Bancorp shares (NYSE:
) shares fell 0.08 percent pre-market as Moody's downgraded the
company citing interest rate pressures.
Notable companies expected to report earnings Friday
- The Bank of Nova Scotia (NYSE:
) is expected to report fourth quarter EPS of $1.19 vs. $1.10 a
- KMG Chemicals (NYSE:
) is expected to report first quarter EPS of $0.31 vs. $0.31 a
On the economics calendar Friday, it's the first Friday of the
month and that means it's Non-Farm Payrolls day. By the
- Median estimate is +86k, +90k private payrolls, range is an
- Unemployment rate est. 7.9 percent vs. 7.9 percent
- ISM Manufacturing Employment Sub-Index 48.4 vs. 52.1
- ISM Non-Manufacturing Employment Sub-Index 50.3 vs. 54.9
- ADP Payrolls 118k vs. 157k previous.
Also, consumer sentiment and credit data are both due out.
Good luck and good trading.
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