Growth hopes that served as a buoy yesterday seems to be giving way to despair, as reflected by the U.S. index futures, which point to a notably lower opening on Wednesday. Reports suggested that China may not dole out substantial stimulus, and impacting risk appetite further was the rejection by the Europe to recapitalize ailing Spanish bank Bankia. The markets may also stay tuned to a domestic housing report due to be released shortly after the markets open.
As of 6:30 am ET, the Dow futures are slipping 105 points, the S&P 500 futures are receding 12.40 points and the Nasdaq 100 futures are moving down 25 points.
U.S. stocks advanced on Tuesday, as optimism over the global economy gained ground following speculation of additional Chinese stimulus announcement and the developments in Greece that suggested that the nation's position in the eurogroup may be secured.
On the economic front, New York Federal Reserve Bank President William Dudley will do a press briefing on job polarization and rising inequality in the region at 1 pm ET.
Dallas Federal Reserve Bank President Richard Fisher is due to speak to a community forum sponsored by the Bank, on "Federal Reserve Operations and Economic Update," in San Antonio at 1:20 pm ET.
Boston Federal Reserve President Eric Rosengren will speak at the 27th Annual Meeting of the Worcester Regional Research Center at 4:30 pm ET.
Data on Pending Home Sales, which is a leading indicator of housing market activity released by the National Association of Realtors, is due out at 10 AM ET. The index is expected to have risen 0.5 percent in April following a 4.1 percent jump in the previous month.
In corporate news, Pep Boys (PBY) announced that it has terminated the proposed merger between the company and the Gores Group, which was announced on January 30, 2012 for $50 million and certain merger related expenses.
Copart (CPRT) reported third quarter net income of 43 cents per share, higher than 35 cents per share in the year-ago quarter. Revenues rose to $244 million from $236.8 million in the year-ago period. Analysts expected earnings of 23 cents per share on revenues of $259.37 million.
Research In Motion (RIMM) said in a business update that it expects an operating loss for its first quarter, attributing the expected loss to the ongoing to competitive environment. The company also said it is seeing lower volumes and a highly competitive pricing dynamics.
Fred's (FRED) reported same store sales rose 1.3 percent year-over-year in May compared to a 0.2 percent in the same period last year.
THQ (THQI) announced the appointment of Jason Rubin as president, effective immediately.
Coldwater Creek (CWTR), Lions Gate Entertainment (LGF) and Tivo (TIVO) are among the companies due to release their results after the markets close.
The Asian markets are apparently unimpressed by the positive close by Wall Street and European stocks overnight and are currently trading mostly lower. The still-unresolved European debt crisis and its ramifications and apprehension ahead of some key data points from the U.S. over the course of the week is keeping sentiment subdued. Domestically, Australia reported an unexpected drop in retail sales, questioning the strength of recovery in the region.
Hurting sentiment further was a report by Xinhua that China may not roll out massive stimulus to support growth at this time.
Japan's Nikkei 225 average closed down 23.89 points or 0.28 percent at 8,633. Financial stocks were the worst hit. Australia's All Ordinaries closed 19.50 points or 0.47 percent lower at 4,149. Australia reported that retail sales fell 0.2 percent month-over-month in April compared to expectations for a 0.2 percent increase. Material and energy stocks retreated sharply.
Meanwhile, Hong Kong's Hang Seng Index ended at 18,690, down 365.24 points or 1.92 percent.
The major European markets are retreating, with the French CAC 40 Index, German DAX Index and the U.K.'s FTSE 100 Index retreating over 1 percent each.
Crude oil futures retreating sharply and is trading in the mid-$89-a-barrel, while gold futures are also lower.
by RTT Staff Writer
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