Futures Slide on Asian Weakness
U.S. equity futures slid in early pre-market trade after Asian
shares reversed early gains to close lower. The Japanese Nikkei
Index broke an eight-day winning streak to close lower after
opening higher and raising hopes of a record nine-day winning
In other news around the markets:
Greece will need to lay out a plan to cut another 150,000 jobs by
2015 to receive its next bailout payment due next week of about 3.5
billion euros. U.K. January industrial production fell 1.2 percent,
well worse than forecasts of a 0.1 percent gain and also much worse
than December's 1.1 percent gain. Manufacturing output also fell
1.5 percent in January on expectations of a flat reading. Goldman
Sachs Asset Management outgoing Chairman Jim O'Neill says
equities look expensive
on a cyclically adjusted price-to-earnings ratio and that he fears
the dreaded May top in equities. S&P 500 futures fell 1 point
to 1,549.50. The EUR/USD was lower at 1.3012. Spanish 10-year
government bond yields fell to 4.71 percent from 4.75 percent.
Italian 10-year government bond yields fell to 4.6 percent from
4.65 percent. Gold rose 0.21 percent to $1,581.30 per ounce.
Asian shares were lower overnight on weak economic data despite
comments from incoming Bank of Japan Deputy Governor Kikuo Iwata
that more easing is to come in the near future. The Japanese Nikkei
Index fell 0.28 percent and the Shanghai Composite Index fell 1.04
percent while the Hang Seng Index fell 0.87 percent. Also, the
Korean Kospi fell 0.5 percent and Australian shares declined 0.56
European shares were modestly higher in early trade despite some
weak economic data from the U.K. as inflation in Germany and other
core European nations remained low in February, signaling more room
for the ECB to ease policy further. The Spanish Ibex Index rose 0.5
percent and the Italian FTSE MIB Index rose 0.63 percent.
Meanwhile, the German DAX rose 0.1 percent and the French CAC rose
0.01 percent while U.K. shares rose 0.03 percent.
Commodities were mixed overnight as energy futures fell and
precious metals futures rose. WTI Crude futures fell 0.21 percent
to $91.87 per barrel and Brent Crude futures fell 0.23 percent to
$109.97 per barrel. Copper futures fell 0.2 percent to $351.00 per
pound on the Asian weakness and weak U.K. data. Gold was higher and
silver futures rose 0.21 percent to $28.92 per ounce.
Currency markets were in clear risk off mode as the dollar and
the yen reigned and the euro and the pound slid. The EUR/USD was
lower at 1.3012 and the dollar fell against the yen to 95.95.
Overall, the Dollar Index rose 0.16 percent on strength against the
euro, the pound, and the Canadian dollar. The GBP/USD fell 0.5
percent following the weak data to 1.4842, breaking through the
1.49 level, as the pound weakened broadly. Also, the yen was
stronger against both the euro and the Aussie dollar.
Stocks moving in the pre-market included:
Yum! Brands (NYSE:
) shares rose 5.4 percent pre-market after the company revised
higher same store sales estimates for its Chinese operations in
January and also reported data for February. Diamond Foods (NASDAQ:
) shares fell 5.85 percent pre-market after reporting worse than
expected fiscal second quarter operations. Urban Outfitters
) shares fell 2.29 percent pre-market after reporting slightly
worse than expected second quarter operations. VeriFone Systems
) shares rose 7.58 percent after announcing that its CEO was
stepping down following an approximately 63 percent slide in the
stock price in the last 52-weeks.
Notable companies expected to report earnings Tuesday
Acadia Pharmaceuticals (NASDAQ:
) is expected to report a fourth quarter loss of $0.09 per share
vs. a loss of $0.10 per share a year ago. Costco Corp. (NASDAQ:
) is expected to report second quarter EPS of $1.06 vs. $0.90 a
year ago. Dole Foods (NYSE:
) is expected to report a fourth quarter loss of $0.02 per share
vs. a loss of $0.02 per share a year ago. Embraer (NYSE:
) is expected to report fourth quarter EPS of $0.87 vs. a loss of
$0.51 per share a year ago. JinkoSolar Holding Co. (NYSE:
) is expected to report a fourth quarter loss of $0.80 per share
vs. a loss of $2.58 per share a year ago. XOMA Holdings (NASDAQ:
) is expected to report a fourth quarter loss of $0.26 per share
vs. a loss of $0.34 per share a year ago.
On the economics calendar Tuesday, the NFIB Small Business
Optimism Index is set to be released alongside chain store sales
and the Redbook. The Treasury is also set to auction 4-week and
3-year notes and also issue its monthly budget statement.
Overnight, French payrolls and eurozone industrial production data
should move markets.
Good luck and good trading.
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