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Wall Street's Economic Fears Abound


Wall Street's pre-occupation with economic worries has intensified, as some recent data point has triggered worries of further weakening of global growth. Fears that the stimulus measures announced by various central banks may not yield the desired results, given the economic frailties, have rendered the mood cautious, making traders uneasy about any piece of below-par incoming economic evidence. After Chinese and European manufacturing sector painted a weak picture, the market attention now turns towards domestic data on the job market and the manufacturing sector.

As of 6:30 am ET, the Dow futures are moving down 36 points, the S&P 500 futures are slipping 4.70 points and the Nasdaq 100 futures are moving down 7.75 points.

U.S. stocks posted modest gains on Wednesday, as mixed housing market reports kept sentiment subdued.

On the economic front, the Labor Department is due to release its customary jobless claims report for the week ended September 15th at 8:30 AM ET. Economists expect claims to decline to 373,000 from 382,000 in the previous week.

The results of the Philadelphia Federal Reserve's manufacturing survey are due out at 10 am ET. Economists expect the diffusion index of current activity to show a reading of -4 for September compared to -7.1 in August.

Around the same time, the Conference Board is scheduled to release a report on the U.S. leading economic indicators index for August. The consensus estimate calls for unchanged reading for the index.

Boston Federal Reserve Bank President Eric Rosengren is scheduled to speak to the South Shore Chamber of Commerce in Quincy, Massachusetts at 7:44 am ET.
Minneapolis Federal Reserve Bank President Naryana Kocherlakota is scheduled to speak to the Gogebic Community College in Ironwood, Michigan at 12:30 pm ET.

Cleveland Federal Reserve Bank President Sandra Pianalto will speak at the Miami University Farmer School of Business at 5 pm ET. St. Louis Federal Reserve Bank President James Bullard is due to speak at the University of Notre Dame at 6:30 pm ET.

In corporate news, Adobe Systems (ADBE) reported third quarter non-GAAP earnings that were in line, while its revenues fell short of estimates. However, the company's fourth quarter guidance was lackluster.

CLARCOR's (CLC) third quarter results were below estimates. The company lowered its 2012 earnings guidance of $2.50-$2.45 per share, while it expects 0-2 percent sales growth. Meanwhile, Apogee (APOG) reported better than expected second quarter results. The company raised its earnings guidance to 56-64 cents per share from 48-58 cents per share, ahead of the consensus estimate.

Bed Bath Beyond's (BBBY) second quarter earnings missed estimates, while its revenues exceeded estimates. The company expects third quarter earnings of 99 cents per share to $1.04 per share, surrounding the $1.02 per share.

Northrop Grumman (NOC) announced that its board has authorized an increase in its stock buyback authorization to $2 billion. Nike (NKE) announced that its board has approved a new 4-year $8 billion to buy back Nike's Class B common stock.

Cintas (CTAS), Oracle (ORCL) and TIBCO Software (TIBX) are among the companies due to release their quarterly results after the markets close.

The Asian markets fell across the board, as some lackadaisical economic data released from across the globe hurt sentiment. China released a weak manufacturing data and Japanese trade data also reflected the soft patch entrenching the global economy.

Japan's Nikkei 225 closed down 145.23 points or 1.57 percent at 9,087. Most stocks, barring defensive telecom, construction, real estate, bank and utility stocks, declined. Dainippon Screen Manufacturing, JTEXT, Minebea, Mitsubishi Motors and Tokyo Electron were among the worst decliners.

Australia's All Ordinaries closed down 20.60 points or 0.46 percent at 4,420, with energy and materials stocks leading the declines. Hong Kong's Hang Seng Index ended at 20,591, down 250.99 percent or 1.20 percent. Meanwhile, the Shanghai Composite Index tumbled 42.99 points or 2.08 percent at 2,025, settling at the lowest closing since February 2, 2009.

The major European markets are declining, as economic fears and uncertainties containing the region's debt crisis are plaguing investor sentiment.

In economic news, preliminary estimates released by Markit Economics showed that the eurozone manufacturing activity contracted at a slower pace in September. The manufacturing index rose 0.9 points to 46 in September, while economists expected a reading of 45.5. Meanwhile, the service sector index fell to 46 from 47.2 in August. Consequently, the composite output index fell to 45.9 from August's 46.3.

U.K.'s retail sales fell by less than expected in August, according to a report released by the U.K. Office for National Statistics. Retail sales fell 0.2 percent month-over-month in August compared to a 0.3 percent increase in July. Economists expected a 0.3 percent drop.

by RTTNews Staff Writer

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