Futures Lower On Europe Fears, Cyprus Banks, Eyeing GDP
U.S. equity futures traded lower in early pre-market trade on
European fears as Cyprus looks set to reopen its banks for the
first time since a week ago Monday. The government will put in
place harsh capital controls for a minimum of two weeks,
effectively making a euro in Cyprus worth less than a euro anywhere
else in the eurozone.
In other news around the markets:
German retail sales in February rose faster than expected, gaining
0.4 percent vs. an expected decline of 1.0 percent. However, sales
rose slower than the 3.1 percent rate in January. Chinese
Industrial Profits in March rose 17.7 percent from a year ago,
better than the previous figure of a gain of 5.5 percent. Moody's
affirmed both Ireland and Portugal's credit ratings and left the
nations on credit watch negative as the nations continue to escape
the debt crisis. S&P 500 futures fell 4.2 points to 1,552.50.
The EUR/USD was lower at 1.2771. Spanish 10-year government bond
yields rose 7 basis points to 5.15 percent. Italian 10-year
government bond yields rose 6 basis points to 4.83 percent. Gold
fell 0.09 percent to $1,605.30.
Asian shares were lower overnight led by Chinese stocks as
global growth fears reigned. The Japanese Nikkei Index fell 1.26
percent and the Shanghai Composite Index declined 2.82 percent
while the Hang Seng Index fell 0.74 percent. Also, the Korean Kospi
was flat and Australian shares fell 0.57 percent.
European shares were lower overnight as Cyprus prepares to open
its banks and allow depositors to begin to withdraw money. The
Spanish Ibex Index fell fell 1.11 percent and the Italian FTSE MIB
Index fell 0.27 percent as Italy was unable to form a government.
Meanwhile, the German DAX fell 0.11 percent and the French CAC
declined 0.36 percent while U.K. shares slid 0.05 percent.
Commodities were mixed overnight ahead of the key U.S. GDP data
as global growth fears weighed on prices. WTI Crude futures were
flat at $96.56 per barrel and Brent Crude futures fell 0.13 percent
to $109.52 per barrel. Copper futures declined 0.38 percent to
$343.15 per pound. Gold was lower and silver futures rose 0.17
percent to $28.68 per ounce.
Currency markets were in a clear risk-off mode overnight as the
yen gained and the euro slid. The EUR/USD was lower at 1.2771 and
the dollar fell against the yen by 0.46 percent to 94.03. Overall,
the Dollar Index rose 0.04 percent on strength against the euro,
the Canadian dollar, and the Swedish krone. Notably, the Australian
dollar was rather weak and most yen crosses declined sharply.
Stocks moving in the pre-market included:
Morgan Stanley (NYSE:
) shares fell 1.3 percent pre-market as Credit Suisse (NYSE:
) purchased its European private wealth operations. United States
) shares fell 0.86 percent as metal futures slid and also as the
company bought back $400 million of senior convertible notes. Red
) shares declined 3.74 percent pre-market as the company reported
better than expected earnings but lowered guidance. PVH Corp.
) shares declined 4.51 percent pre-market as the company reported
weak earnings and lowered guidance.
Notable companies expected to report earnings Thursday
) is expected to report a fourth quarter loss of $0.30 per share
vs. EPS of $0.22 a year ago. The Finish Line (NASDAQ:
) is expected to report fourth quarter EPS of $0.75 vs. $0.81 a
year ago. Gamestop (NYSE:
) is expected to report fourth quarter EPS of $2.09 vs. $1.73 a
On the economics calendar Thursday, the final revision to U.S.
fourth quarter GDP is due out as well as weekly jobless claims and
the PCE Inflation Index. Also, the Chicago PMI and the Kansas City
Fed Manufacturing Index are due out. In addition, the Treasury is
set to auction 7-year notes. Overnight, Korean and Japanese
industrial production are due out, however U.S. markets will be
Good luck and good trading.
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