The major U.S. index futures are pointing to a sharply lower opening on Tuesday, with sentiment reflecting extreme caution ahead of the existing home sales report due to be released shortly after the markets open. The markets have, however, discounted a decline in existing home sales for the third straight month. The Asian markets ended the session mostly lower, while the European averages are seen mired in negative territory. Safe havens such as the yen are advancing sharply.
U.S. stocks surrendered their early strength in Monday's session and closed moderately lower. Encouraged by deal news, the major averages opened higher, but they gradually gave back their gains, dipping into negative territory by early afternoon trading. Thereafter, the Dow Industrials and the S&P 500 Index went about a volatile ride, moving decisively into negative territory in late trading. At the same time, the Nasdaq Composite continued to languish in negative territory after seeing some initial strength.
The Dow Industrials ended down 39.21 points or 0.38% at 10,174 and the S&P 500 Index closed 4.33 points or 0.40% lower at 1,067, while the Nasdaq Composite Index fell 20.13 points or 0.92% at 2,160.
Among the Dow components, fourteen stocks closed lower and 2 stocks ended unchanged, while the remaining stocks ended higher. Boeing (BA), Alcoa (AA), Caterpillar (CAT), Cisco Systems (CSCO) and Hewlett-Packard (HPQ) declined sharply. However, Pfizer (PFE) and Merck (MRK) saw notable gains.
The NYSE Arca Airline Index was among the worst decliner among the sector indexes, dropping 1.81%. The Dow Jones Transportation Average fell 1.15%, the S&P Retail Index receded about 1%, the NYSE Arca Gold Bugs Index lost 1.27%, the Philadelphia Semiconductor Index moved down 1.25%, the NYSE Arca Networking Index slipped 1.09% and the Philadelphia Housing Sector Index declined 1.79%.
Currency, Commodity Markets
Crude oil futures are receding $0.84 to $72.26 a barrel after declining $0.72 to $73.10 a barrel in the previous session. Gold futures, which edged down $0.30 to $1,228.50 an ounce, in the previous session, are currently receding $10.50 to $1,265.24 an ounce.
Among currencies, the U.S. dollar is trading at 83.905 yen compared to the 85.1582 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is trading at $1.2590 compared to the previous session's $1.2657.
Asia
The major Asian markets ended Tuesday's session mostly lower, as the see-sawing sentiment concerning the global economic recovery continued to haunt traders. The Japanese market ended sharply lower, as the safe haven yen continued to climb.
Japan's Nikkei 225 average opened sharply lower and continued to languish in negative territory throughout the session to close down 121.55 points or 1.33% at 8,995, its worst level since May 1st, 2009. A majority of stocks declined in the session, with the exception of some defensive stocks. The index has taken a severe hit amid the strengthening of the yen, which has been firming up due to safe haven buying. The yen is currently firmer at a 15-year high of 83.91
Australia's All Ordinaries opened lower and declined steadily till early afternoon trading before paring back some of its losses by late afternoon trading. More selling followed and the index ended down 42.10 points or 0.94% at 4,418.
Consumer staple, energy and material stocks led the slide, while most other sectors also ended lower. However, defensive healthcare and telecom stocks gained some ground.
Miner BHP Billiton declined about 1.5%, while bigger peer Rio Tinto ended down more than 1.5%. Other miners, including Newcrest Mining and Orica showed weakness, while Incitec ended slightly higher. The four major banks also receded.
Fosters fell after it reported a net loss of 464.4 million Australian dollars for its second-half compared to a profit of 438.3 million Australian dollars last year. On an adjusted basis, excluding a non-cash impairment charge, the company reported a profit of 698.3 million Australian dollars.
The consolidation in the resource space is continuing, with the latest company to express interest in a smaller peer being Xstrata, which said it has negotiated a $381 million agreed takeover deal with Australian iron ore miner Sphere Minerals.
Hong Kong's Hang Seng Index, which opened lower but clawed its way back into positive territory by the mid-session, retreated in the afternoon to close down 23.30 points or 1.10% at 20,659. Among index heavyweights, HSBC Holdings and China Mobile ended sharply lower. China-related stocks also saw weakness, while property stocks showed mixed sentiment.
Europe
The major European averages, which broke a 3-session slide yesterday, are trading sharply lower on Tuesday. The French CAC 40 Index and the German DAX Index are slipping 1.78% and 1.51%, respectively, while the U.K.'s FTSE 100 Index is declining 1.74%.
In economic news, a report released by Eurostat showed that the pace of growth in new industrial orders received by euro area manufacturers slowed down in June from May but was stronger than expected. New orders rose by 2.5% compared with the previous month, slower than the 4.1% growth in May. Economists had forecast a 1.5% increase.
The revised second quarter GDP report released by the German Federal Statistical Office showed that German GDP rose at an unrevised 2.2% rate sequentially following a 0.5% increase in the second quarter. Foreign trade and capital formation contributed most to GDP growth during the second the quarter.
U.S. Economic Reports
The National Association of Realtors is scheduled to release its report on existing home sales for July at 10 AM ET. Economists estimate existing home sales of 4.72 million for the month.
In June, existing home sales came in at a seasonally adjusted annual rate of 5.37 million units compared to a 5.66 million units in May. Economists had expected a steeper decline to 5.1 million units. Inventories measured in months of supply rose to 8.9 months from 8.3 months in May, rising to the highest level since August 2009, while inventories in absolute numbers rose by 99,000 to 3.992 million units. Distressed sales made up 32% of total sales. Meanwhile, the median price of an existing home rose 1% year-over-year.
Stocks in Focus
RadioShack (RSH) could be in focus after it announced that its board has increased its share buyback authorization to $500 million from the earlier $290 million. The board has also directed the company to commence a significant portion of the repurchase program as soon as practicable.
Pfizer (PFE) may see some activity after it said trial results of its drug candidate suitinib in combination with erlotinib versus erlotinib alone demonstrated a statistically significant improvement in progression-free but not in overall survival in patients with previously treated advanced non-small cell lung cancer. The company noted that overall survival was the primary endpoint and progression-free survival was the secondary endpoint.
Borders Group (BGP) may also be in focus after it announced the resignation of its CFO Mark Bierley. The company also announced the appointment of VP Glen Tomaszewski as interim CFO.
Medtronic (MDT) is expected to move in reaction to its announcement that its first quarter non-GAAP earnings declined 2% to 80 cents per share. Revenues fell to $3.77 billion from the year-ago's $3.93 billion. The consensus estimates had called for earnings of 81 cents per share on revenues of $3.95 billion. The company reduced its 2011 earnings guidance, now expecting earnings of $3.40-$3.48 per share on revenue growth of 2%-5%. Analysts estimate earnings of $3.48 per share on revenues of $16.33 billion.
Big Lots (BLI) could see some activity after it reported that its second quarter net income from continuing operations declined to 48 cents per share from 34 cents per share last year. Net sales rose 5.1% to $1.14 billion. Analysts estimated earnings of 47 cents per share on revenues of $1.15 billion. The company raised its 2010 income from continuing operations guidance to $2.82-$2.90 per share, while the Street expects earnings of $2.85 per share.
Burger King Holdings (BKC) is also expected to be in focus after it said its adjusted earnings per share declined to 36 cents from 43 cents. Worldwide revenues fell 1% to $623 million. While earnings beat the consensus estimate of 34 cents per share, revenues trailed the mean analysts' estimate of $635.19 million.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.