Opening View: Stock Futures Point to Another Day in the Red, Despite G-20 Pledge

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U.S. stocks are set to follow their global comrades lower once again today, despite a pledge from the Group of 20 (G-20) finance ministers. Specifically, the group vowed to do whatever it takes "to preserve the stability of the banking systems and financial markets," and to make sure banks have the capital needed to stay afloat. Nevertheless, it appears Wall Street is taking the G-20 statement with a proverbial grain of salt, with the Dow Jones Industrial Average (DJIA) bracing for another triple-digit deficit out of the gate.

Dow, S&P and Nasdaq futures

In earnings news, Nike (NKE - 84.18) reported a fiscal first-quarter profit of $645 million, or $1.36 per share, up 15% from the year-ago quarter. Revenue, meanwhile, increased 18% to $6.08 billion. The results were better than expected, as analysts, on average, were anticipating earnings of $1.21 per share on sales of $5.75 billion. "The better we get at running this offense, the stronger results we see," said CEO Mark Parker, who said the solid results just confirm that Nike is a "growth company." At last check, the shares of NKE are poised to open about 5.4% higher.

Tibco Software (TIBX - 57.48) reported a third-quarter profit of $23.5 million, or 14 cents per share, up from $17.4 million, or 10 cents per share, in the year-ago period. On an adjusted basis, earnings rose to 23 cents from 17 cents per share last year. Analysts had expected a profit of only 21 cents per share. Revenue rose 24% to $229 million, besting the consensus estimate of $219.9 million. "Once again, we delivered strong growth in revenue and profitability this quarter, as we continue to see broad-based demand for TIBCO's event-driven platform," said Chairman and CEO Vivek Ranadive. In pre-market action, TIBX is headed 3.7% higher.

Finally, Cintas (CTAS - 28.77) revealed a first-quarter profit of $68.6 million, or 52 cents per share, compared to $61.3 million, or 40 cents per share, in the year prior. Meanwhile, revenue increased by 10% to $1.02 billion, from $923.9 million in the year-ago period. Analysts had predicted a profit of 47 cents per share on revenue of $996 million. "Our focus on selling profitable business, managing our cost structure and improving efficiencies through process improvement continues to drive margin expansion," said CEO Scott D. Farmer. Looking ahead, CTAS reaffirmed its fiscal 2012 earnings forecast of $1.97 to $2.05 per share on revenue of $4 billion to $4.1 billion. Meanwhile, analysts predicted annual earnings of $2.01 per share on revenue of $4.09 billion. Ahead of the bell, CTAS is set to open with a 1.4% lead.

Earnings Preview

Today's earnings docket will also feature reports from Finish Line ( FINL ) and KB Home ( KBH ). Keep your browser at SchaeffersResearch.com for more news as it breaks.

Economic Calendar

There are no major economic reports scheduled for today.

Market Statistics

Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 1,324,954 call contracts traded on Thursday, compared to 1,146,906 put contracts. The resultant single-session put/call ratio arrived at 0.87, while the 21-day moving average was 0.71.

NYSE and Nasdaq summary

Volatility indices

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Overseas Trading

Asian markets turned south today, bogged down by the same macroeconomic concerns that dragged Wall Street to a dramatically negative finish on Thursday. In South Korea, oil stocks and shippers swallowed heavy losses on expectations for weaker global demand, while steel and aluminum issues paced the decliners in Hong Kong. However, most regional benchmarks ended off their session lows, after G-20 finance officials released a communiqué vowing "to preserve the stability of banking systems and financial markets as required." By the close, South Korea's Kospi lost 5.7%, Hong Kong's Hang Seng fell 1.4%, and China's Shanghai Composite shed 0.4%. Markets in Japan are closed for holiday.

Meanwhile, traders in Europe haven't put much stock in the G-20's pledge to provide support, with regional indexes broadly lower at midday. Greek banks are a particular pocket of weakness after a Moody's downgrade, with the ratings agency citing "significant solvency challenges" for the government. The jittery mood was exacerbated by comments from the European Central Bank's Klaas Knot, who told a Dutch newspaper, "I am now less certain in ruling out a [Greek] default than I was a couple of months ago." At last check, the German DAX is down 3%, the French CAC 40 is off 2.5%, and London's FTSE 100 is 1.8% lower.

Overseas markets

Currencies and Commodities

After skyrocketing on Thursday, the greenback is taking a breather this morning, with the U.S. dollar index fractionally lower at last check. Crude futures, on the other hand, have continued their retreat to multi-week lows, with the front-month contract down $1.57, or 2%, to trade near $78.94 per barrel. Likewise, gold futures have also extended their pullback south of $1,800 an ounce, with the malleable metal last seen $31.70, or 1.8%, lower at $1,710 an ounce.

Currencies and commodities

Unusual Put and Call Activity:

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Unusual options activity - puts

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This article appears in: Investing , Options

Referenced Stocks: CBOE , FINL , KBH

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