Stocks pause before banks report

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Stocks are down slightly this morning as investors await a flood of bank earnings later this week.

S&P 500 futures are down a little more than 0.1 percent but are near their highs of the session, while most European indexes are posting small gains. Asia was mostly higher overnight, led by gains of more than 2 percent in Thailand and Indonesia. Tokyo was closed.

While today's event calendar is empty, tomorrow brings quarterly results from JP Morgan and Wells Fargo, followed by Bank of America on Wednesday and Citigroup, Goldman Sachs, PNC Financial, Capital One American Express, and BB&T on Thursday. (See our related calendar story )

The S&P 500 has been inching higher in the last week, attempting to hold support at its 10-day moving average. Leadership has recently shifted toward health care as drug makers advance. There could be further upside today as Alnylam Pharmaceuticals rallies 30 percent on news it will receive a $700 million investment from France's Sanofi. Airlines, tire makers, firearms, and European banks have also been strong, according to our researchLAB market scanner.

Retail, on the other hand, has struggled as companies wind down a poor holiday-shopping season. Lululemon Athletica and Express are both down this morning after pre-announcing weak fourth-quarters. The industry could be active again tomorrow with the Commerce Department set to report monthly retail sales.

Homebuilders and utilities are other areas to watch as borrowing costs decline. Rates dropped from long-term peaks on Friday after monthly payrolls grew much less than expected--a potential sign of economic weakness--and are mixed this morning.

Natural gas is the big mover in the commodity market, climbing almost 3 percent in early trading. Crude oil, silver and copper are down more than half a percent and most agricultural products are weak.

In foreign-exchange markets, the Japanese yen is higher across the board and the euro is up slightly against the greenback. The Australian dollar is also inching higher, attempting to rebound from long-term lows.

In other company-specific news, alcoholic beverage maker Beam agreed to be purchased by Japan's Suntory for $13.6 billion in cash. Fortinet, the target of heavy call buying in recent sessions, also climbed on a Morgan Stanley upgrade.



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.

Copyright © 2010 OptionMonster® Holdings, Inc. All Rights Reserved.


This article appears in: Investing , Options

Referenced Stocks: SPX

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