Futures Slide On Weak Earnings
U.S. equity futures slid overnight following weak earnings
reports from tech giants Microsoft (NASDAQ:
) and Google (NASDAQ:
). Both companies reported top and bottom line misses.
In other news around the markets:
Detroit finally, after years of fiscal troubles, declared the
nation's largest ever municipal bankruptcy. The move will allow the
city to freeze pension payments and adjust measures such as
standard of living increases to help plug budget holes. Moody's
upgraded its outlook on the U.S. government to stable from negative
and maintained the U.S. at a Aaa rating. They noted that if the
deficit does not get under control then it could prompt a
downgrade. S&P 500 futures fell 2.6 points to 1,678.00. The
EUR/USD was lower at 1.3103. Spanish 10-year government bond yields
fell 1 basis point to 4.65 percent. Italian 10-year government bond
yields fell 1 basis point to 4.4 percent. Gold rose 0.21 percent to
$1,288.20 per ounce.
Asian shares were lower overnight following the weak U.S.
earnings after the bell, which are described in detail below. The
Japanese Nikkei 225 Index declined 1.48 percent and the Topix Index
fell 0.82 percent. In Hong Kong, the Hang Seng Index rose 0.08
percent while the Shanghai Composite Index declined 1.52 percent in
China. Also, the Korean Kospi fell 0.22 percent and Australian
shares lost 0.43 percent.
European shares were also lower overnight on very little news on
the economic front as earnings sentiment weighed. The Spanish Ibex
Index declined 0.62 percent and the Italian FTSE MIB Index fell
0.16 percent. Meanwhile, the German DAX fell 0.53 percent and the
French CAC 40 Index lost 0.56 percent while U.K. shares declined
Commodities were mixed overnight as oil pulled back from recent
highs. WTI Crude futures fell 0.19 percent to $107.83 per barrel
and Brent Crude futures declined 0.17 percent to $108.51 per
barrel. Copper futures fell 0.43 percent to $311.80 per pound. Gold
was higher and silver futures fell 0.12 percent to $19.37 per
Currency markets were volatile overnight as the dollar retraced
some losses from earlier in the overnight session. The EUR/USD was
lower at 1.3105 and the dollar fell against the yen. Overall, the
Dollar Index fell 0.07 percent on weakness against the pound, the
yen, and the Swiss franc.
Earnings Reported Yesterday
Key companies that reported earnings Thursday include:
) reported second quarter EPS of $1.40 vs. $1.25 expected on
revenue of $30.4 billion vs. $30.5 billion expected. Verizon (NYSE:
) reported second quarter EPS of $0.73 vs. $0.72 expected on
revenue of $29.79 billion vs. $29.82 billion expected. Microsoft
) reported fourth quarter EPS of $0.66 vs. $0.75 expected on
revenue of $19.9 billion vs. $20.79 billion expected. Google
) reported second quarter EPS of $9.56 vs. $10.79 expected on
revenue of $14.11 billion vs. $14.42 billion. Johnson Controls
) reported third quarter EPS of $0.83 vs. $0.75 expected on revenue
of $10.8 billion vs. $10.99 billion. The company also announced an
asset sale and hinted at further sales to come in the future. Union
) reported second quarter EPS of $2.37 vs. $2.35 on revenue of
$5.47 billion vs. $5.5 billion expected.
Stocks moving in the pre-market included:
) shares fell 3.92 percent pre-market on the earnings miss.
) shares fell 6.38 percent as it also missed earnings estimates.
Chipotle Mexican Grill (NYSE:
) shares rose 5.34 percent pre-market after reporting stronger than
expected earnings and raising full year sales guidance. Corelogic
) shares rose 0.86 percent pre-market as the company acquired a set
of assets from Bank of America (NYSE:
), no terms disclosed.
Notable companies expected to report earnings Friday
) is expected to report second quarter EPS of $1.21 vs. $1.25 a
year ago on revenue of $9.702 billion vs. $9.435 billion a year
ago. Lab Corp. (NYSE:
) is expected to report second quarter EPS of $1.80 vs. $1.63 a
year ago on revenue of $1.44 billion vs. $1.423 billion a year ago.
) is expected to report second quarter EPS of $1.10 vs. $1.05 a
year ago on revenue of $11.12 billion vs. $1045 billion a year ago.
General Electric (NYSE:
) is expected to report second quarter EPS of $0.35 vs. $0.38 a
year ago on revenue of $35.56 billion vs. $36.11 billion a year
On the economics calendar Friday, there is no important data due
out. Over the weekend, watch out for the Japanese upper house
elections to set the tone for the overnight session heading into
Good luck and good trading.
Tune into Benzinga's PreMarket Info show with Dennis Dick and
For a recap of Thursday's market action, read Benzinga's daily
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