Opening View: Gold Nears $1,300 an Ounce; DJIA Futures Indicate Weak Open

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The Dow Jones Industrial Average (DJIA) scored a small victory yesterday, as the blue-chip barometer posted a fractional gain after the Federal Open Market Committee (FOMC) forecast slow U.S. economic growth. The DJIA enters today above support in the 10,700 region, but below resistance in the 10,800-10,850 area. Wall Street appears ready to extend Tuesday's late-session pullback, as futures on the DJIA and the S&P 500 Index are trading 23 points and 2.7 points below fair value, respectively. Elsewhere, gold is dominating the landscape, with futures on the precious metal soaring to record highs within reach of $1,300 an ounce.

In equity news, shares of Adobe Systems Inc. ( ADBE ) have plunged more than 20% in premarket trading, as investors flee the company in the wake of its fourth-quarter earnings forecast. Specifically, ADBE said it expects fiscal fourth-quarter sales between $950 million to $1 billion, below the current Wall Street estimate of $1.03 billion. The company also forecast fourth-quarter earnings of 48 cents to 54 cents per share, on the low end of the consensus estimate for a profit of 53 cents per share.

Elsewhere, Cintas Corp. ( CTAS ) said its fiscal first-quarter profit rose to $61.3 million, as revenue increased to $923.9 million from $891.6 million last year. Analysts estimated a quarterly profit of 38 cents per share on revenue of $913.5 million.

Finally, Darden Restaurants ( DRI ) announced a first-quarter profit of $113.1 million, or 80 cents per share, with sales rising to $1.81 billion. Analysts were looking for a profit of 77 cents per share on revenue of $1.83 billion.

Earnings Preview

On the earnings front, CarMax Inc. ( KMX ), General Mills Inc. ( GIS ), Bed Bath & Beyond Inc. ( BBBY ) and Red Hat Inc. ( RHT ) are slated to release their quarterly earnings reports today. Keep your browser at SchaeffersResearch.com for more news as it breaks.

Economic Calendar

The usual weekly report on U.S. petroleum supplies is the lone release slated for today, while weekly initial jobless claims will be accompanied by August's existing home sales and leading indicators tomorrow. Rounding out the week, durable goods orders for August and new homes sales for August are on tap on Friday.

Market Statistics

Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,198,654 call contracts traded on Tuesday, compared to 741,126 put contracts. The resultant single-session put/call ratio arrived at 0.62, while the 21-day moving average held at 0.59.

Volatility indices

NYSE and Nasdaq summary

**The volume data shown above is from the Nasdaq and NYSE exchanges only. It does not include regional volume activity, which means that other daily volume quotes you see may be higher.**

Dow, S&P and Nasdaq futures

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Overseas Trading

Overseas trading looks weak this morning, as only three of the 10 foreign indexes that we track are in positive territory. The cumulative average return on the collective stands at a loss of 0.56%. In Asia, regional indexes closed mixed, with property concerns rising to five-month highs in Hong Kong, while Japanese stocks came under pressure due to a rising yen. Meanwhile, European markets are trading broadly lower, as concerns about sovereign debt have crept back to the forefront, though mining stocks are holding their own.

Overseas markets

Currencies and Commodities

The Fed's concerns that the U.S. economic recovery would remain slow and underwhelming sent the U.S. dollar lower in overseas trading. Heading into the open, the U.S. Dollar Index has fallen 0.8% to 79.80, marking the index's first foray below the 80 mark since March. The dollar's decline has been gold's driving force, as the malleable metal has surged $19 to a fresh record high of $1,293.30 in London. Finally, despite the demand concerns raised by the Fed's comments on Tuesday, crude futures are also being lifted by a weak U.S. dollar. In premarket trading, the lead crude contract has added 47 cents to $75.44 per barrel.

Currencies and commodities

Unusual Put and Call Activity:

For an explanation of how to use this information, check out our Education Center topics on Option Volume and Open Interest Configurations .

Unusual options activity - puts

Unusual options activity - calls

Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Options


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