The major U.S. index futures are pointing to a lower opening on Friday. The personal income and spending report released earlier in the day showed that personal income rose more than what economists expected, while personal spending showed a bigger-than-expected drop. Commodity prices are moving to the downside, as recession talks are gaining momentum, and could continue to exert downward pressure on the commodity space. Sentiment over the course of trading also depends on the results of the Chicago-NAPM's manufacturing survey and the consumer sentiment index of the University of Michigan.
U.S. stocks opened higher on Thursday, benefiting from a smaller-than-expected contraction in third quarter economic growth. Although the major averages gave back their gains by the mid-session, they rallied thereafter to close with notable gains. The Dow Industrials advanced 189.73 points or 2.11% to 9,181 and the S&P 500 Index gained 24 points or 2.58% to 954, while the Nasdaq Composite Index rose 41.31 points or 2.49% to 1,699.
Twenty of the thirty Dow components ended the session higher, with Verizon (VZ) ending flat. Technology stocks were on a roll, with Intel (INTC) (up 8.23%) and Hewlett-Packard (HPQ) (up 6.47%) among the notable gainers. Chevron (CVX) (up 4.48%), Disney (DIS) (up 5.67%), Home Depot (HD) (up 4.94%), JP Morgan Chase (JPM) (up 5.35%) and Merck (MRK) (up 5.26%) also advanced sharply. Wal-Mart (WMT), Microsoft (MSFT), Johnson & Johnson (JNJ) and General Motors (GM) receded in the session
Among the sector indexes, the Amex Oil Index and the Philadelphia Oil Service Sector Index rallied 3% and 7.12%, respectively. The Amex Gold Bugs Index gained 3.89%. While the Dow Jones Transportation Average gained 3.23%, the Amex Airline Index surged up 10.74%. The Philadelphia Housing Sector Index and the S&P Retail Index were up over 2% each, while the Amex Biotechnology Index rallied 3.46%. The Philadelphia Semiconductor Index was up 4.04% and the Amex Computer Hardware Index rose 3.70%, with the Amex Disk Drive Index jumping 4.48%. The Amex Networking Index gained close to 5%.
Currency, Commodity Markets
Crude oil futures are trading down $2.08 at $63.88 a barrel after the commodity receded $1.54 to $65.96 a barrel in the previous session. Meanwhile, gold futures are currently declining $5.60 to $732.90 an ounce. On Thursday, the precious metal fell $15.50 to $738.50 an ounce.
On the currency front, the U.S. dollar is trading at 97.84 yen compared to 98.5847 yen it fetched at the close of New York trading on Thursday. The dollar is trading at $1.2740 a euro.
Asia
Stock markets across the Asia-Pacific region closed mixed on Friday despite a positive lead from Wall Street. Asian stocks showed their biggest monthly drop in October, with commodity-related stocks being routed on worries over global demand. The Japanese market plunged 5.0% after the Bank of Japan announced its first rate cut in seven years, while the yen strengthened against the U.S. dollar. Japan's Nikkei 225 average traded below the unchanged line throughout the session, with the selling pressure intensifying in late trading. The index closed down 452.78 points or 5.01% at 8,577.
The Bank of Japan trimmed its key interest rate to 0.3% from a decade-high 0.5%, though the cut was by a split vote and was smaller than the market had expected. The move came amid government pressure to join the global response to the worst financial crisis in 80 years.
Among a slew of economic data released today, the Ministry of Internal Affairs and Communications said that core consumer prices in Japan rose 2.3% year-over-year in September, moving higher for the twelfth consecutive month. The core consumer price index, which excludes volatile fresh food prices, was in line with analyst expectations and follows a 2.4% annual expansion in August.
Meanwhile, unemployment in Japan decreased slightly in September, according to data from the government released on Friday. The nation's seasonally adjusted jobless rate hit 4.0%, down from 4.2% in August. Most economists had forecast the jobless rate to stay at 4.2%.
Banks closed mixed. Mitsubishi UFJ Financial Group plunged 5.4% and Mizuho Financial Group tumbled 5.2%, while Sumitomo Mitsui Financial group advanced 4.7%. Top brokerage Nomura Holdings plummeted 6.1%.
Among exporters, Canon surged up 9.9% and machinery maker Komatsu jumped 10.5%, but Honda Motor plunged 13.0%, Sony fell 2.8% and Toyota Motor shed 4.4%. Mazda slumped 13.8% after it lowered its profit outlook on Thursday.
South Korea's Kospi, which traded back and forth across the unchanged line in a narrow range for most of the session, moved higher in late trading before ending up 28.3 points or 2.6% at 1,113.
Heavy machinery, shipyard, construction, and retail stocks posted strong gains. Leading power generator maker Doosan Heavy Industries soared 14.9%, Hyundai Heavy Industries gained 5.7%, Hyundai Engineering & Construction surged up 15.0%, and discount store chain operator Shinsegae advanced 2.9%. Meanwhile, technology and finance stocks finished lower on profit taking, with LG Electronics tumbling 5.0% and Shinhan Financial Group shedding 5.2%.
The Chinese stock market closed sharply lower, reversing most of Thursday's gains, as concerns about a domestic economic slowdown deepened after more companies posted weak third-quarter earnings. The benchmark Shanghai Composite Index fell 34.8 points or 2.0% to close at 1,729.
Hong's Hang Seng Index languished in negative territory throughout the session before closing down 361.2 points or 2.5% at 13,969. Among market heavyweights, HSBC Holdings fell 3.6% and China Mobile slipped 0.4%. Offshore oil producer CNOOC rose 2.8%.
Property shares bucked the downtrend. China Overseas Land and Gangzhou R&F Properties jumped 6.0% each, Country Garden gained 4.7%, and Agile Property surged 5.1%.
Australia's All Ordinaries opened unchanged, but it reversed course in early trading and tumbled to an intra-day low of 3,903 in late morning trading. Thereafter, the index began to move up and moved into positive territory in late day trading. The index closed up 25.4 points or 0.6% at 3,983.
Big diversified miners were mixed, with Rio Tinto gaining 0.4%, index leader BHP Billiton losing 2.1% and Fortescue plunging 6.1%. Among gold miners, Newcrest Mining rose 1.4%, but Lihir Gold plunged 4.9% after gold prices fell in Sydney. In the energy sector, Oil Search surged 4.7%, but Santos lost 3.3% and Woodside shed 3.0%, as oil prices continued to fall on Friday on demand concerns.
Banks also closed mixed. Westpac slipped 0.1%, ANZ dropped 1.1%, and National Australia Bank declined 0.8%, while Commonwealth Bank gained 0.3%. St George Bank jumped 2.5% and investment bank Macquarie Group rose 1.3%.
Europe
The major European averages are trading lower on Friday, with the French CAC 40 Index and the German DAX Index declining 1.64% and 0.72%, respectively, while the U.K.'s FTSE 100 Index is receding 1.64%.
The European Commission's statistical agency, Eurostat reported that the consumer price index in the euro zone region increased by an estimated 3.2% in October. In September, the index rose 3.6%. Another report released by the agency showed that the euro area's seasonally adjusted unemployment rate was 7.5% in September, unchanged from August. In the year-ago period, the unemployment rate was 7.3%.
U.S. Economic Reports
A Labor Department report showed that total compensation costs rose by 0.7% in the second quarter. The growth was in-line with the estimate of economists. Wages and salaries rose 0.7% compared to a 0.6% increase in benefits.
Meanwhile, the Bureau of Economic Analysis released its personal income & outlays report for September, which showed that personal income rose 0.2%, while personal spending declined 0.3%. Economists expected a 0.1% increase in personal income and a 0.2% decline in personal spending. Personal spending for August was revised up to show 0.1% growth compared to the initial estimate of flat spending, while personal income was revised up to show 0.4% growth compared to 0.2% growth estimated initially.
Spending on durable goods fell 3.1%, reversing the 1.7% increase in August, while spending on services accelerated to a 0.3% rate. The core Personal Consumption Expenditure Index rose 2.4% year-over-year compared to a 2.5% increase in August.
The results of the National Association of Purchasing Management-Chicago's business survey for October are scheduled to be released at 9:45 AM ET on Tuesday. Economists expect the business barometer index based on the survey to fall to 48.
The NAPM-Chicago purchasing managers' September survey showed that the region's business barometer edged down 1.2 points, although it remained above the '50' level at 56.7. While the production index climbed 8 points to 71.4, the new orders index declined 6.3 points to 53.9. The inventories index tumbled 14.5 points to 37.7. Although the employment index soared about 10 points, it remained below the '50' level at 49.1. Emphasizing the inflation concerns, the prices paid index remained above 80 for the eighth month this year.
The final reading of the University of Michigan's consumer sentiment index for October is due to be released at 10 AM ET on Friday. The index is likely to remain unchanged from the mid-month reading of 57.5.
Earnings
Aon (AOC) said its third quarter revenues grew 6% to $1.8 billion. The company's earnings per share from continuing operations climbed 27% to 52 cents per share, while adjusted earnings from continuing operations were 69 cents per share. Analysts estimated earnings of 63 cents per share on revenues of $1.84 billion.
Barnes (B) reported that its third quarter net income per share rose 8.5% to 51 cents. Net sales declined 6.5% to $337.1 million. The consensus estimates had called for earnings of 54 cents per share on revenues of $365.38 million.
American Electric Power (AEP) said its third quarter ongoing earnings per share were 93 cents per share. Revenues climbed to $4.2 billion from $3.8 billion last year. The consensus estimates had called for earnings of $1.04 per share on revenues of $3.94 billion. The company tightened its 2008 ongoing earnings per share guidance to $3.15-$3.25 per share.
NYSE Euronext (NYX) reported that its third quarter revenues rose to $1.2 billion from $1.1 billion in the year-ago period. On an adjusted basis, the company reported earnings of 72 cents per share, lower than 75 cents per share last year. The consensus estimates had called for earnings of 72 cents per share on revenues of $817.31 million.
Stocks in Focus
Sun Microsystems (JAVA) may be in focus after it said its third quarter adjusted loss was 9 cents per share, wider than the 8 cents per share loss estimate of analysts. Sales fell 7.1% to $2.99 billion.
BMC Software (BMC) receded in Thursday's after hours session despite reporting second quarter adjusted earnings of 56 cents per share, ahead of the consensus estimate of 51 cents per share. Revenues rose 11% to $466.7 million, shy of the mean analysts' estimate of $467.4 million. The company raised its 2009 adjusted earnings per share estimate to $2.15-$2.25 per share from its earlier estimate of $2.10-$2.20 per share. The company also announced the appointment of Chief Executive Officer Bob Beauchanp as its Chairman.
Affiliated Computer Services (ACS) may react to its announcement that its third quarter adjusted earnings rose to 89 cents per share from 77 cents per share in the year-ago quarter. Revenues, excluding divestitures, climbed 8% to $1.6 billion. Analysts, on average, estimated earnings of 87 cents per share on revenues of $1.6 billion.
Chesapeake Energy (CHK) is expected to gain ground after it reported that its third quarter earnings climbed to 85 cents per share from 72 cents per share last year, as revenues rose about four fold to $7.5 billion. The consensus estimates had called for earnings of 88 cents per share on revenues of $2.57 billion.
Circuit City (CC) may come under selling pressure after it said it has received a warning from the NYSE that it is not compliant with NYSE standards for continued listing. The company's closing price was less than $1 over a consecutive 30-trading-day period.
Electronic Arts (ERTS) is likely to see weakness after it reported that its second quarter loss widened to 97 cents per share from 62 cents per share last year. On an adjusted basis, the company reported a loss of 6 cents per share. Sales were up 40% to $894 million. Sales, excluding deferred revenues were $1.13 billion, ahead of the consensus estimate of $1.08 billion. The company lowered its 2009 adjusted earnings estimate to $1-$1.40 per share from its earlier estimate of $1.30-$1.70 per share.
Express Scripts (ESRX) could trade higher after it reported third quarter earnings that rose to 81 cents per share from 56 cents per share last year, as revenues increased 2% to $5.45 billion. Analysts expected earnings of 78 cents per share on revenues of $4.65 billion. The company also raised its earnings estimate for 2008.
KLA-Tencor (KLAC) could move to the downside after it reported first quarter adjusted earnings of 32 cents per share, trailing the consensus estimate of 34 cents per share. Revenues declined 23% to $532.5 million.
Security software McAfee (MFE) is likely see some strength after it reported that its third quarter adjusted were 53 cents per share compared to the 49 cents per share consensus estimate. Revenues climbed 27% to $409.7 million, exceeding the mean analysts estimate of $395.2 million.
Unum Group (UNM) could be in focus after it said its third quarter adjusted earnings were 64 cents per share and its revenues were $2.44 billion, down 6.4% from $2.61 billion last year. Analysts, on average, estimated earnings of 63 cents per share on revenues of $2.66 billion.
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June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.