Stocks set to stumble at open
May 5: 7:12am
Futures decline as investors mull fallout from Microsoft's failed Yahoo bid; Yahoo shares sink 19% in Frankfurt.
U.S. stocks looked set to pull back Monday after the recent rally, with attention focused on Yahoo after Microsoft walked away from its takeover bid for the Internet firm.
At 6:25 a.m. ET, Nasdaq and S&P futures were lower and suggesting a negative open for Wall Street.
Stocks ended Friday's session mixed, although all three major gauges ended last week with slim gains after rising to four-month highs.
Microsoft said over the weekend that it withdrew a sweetened offer for Yahoo. The move comes after a three-month long takeover battle that many had expected to turn hostile.
Yahoo (YHOO, Fortune 500) shares are expected to fall sharply when the market opens in New York. In Frankfurt, the stock sank 19%. Microsoft (MSFT, Fortune 500) shares rose 4% in Germany.
The failure of the two sides to reach a deal is likely to spur movement of several Internet stocks, including search leader Google (GOOG, Fortune 500) and Time Warner (TWX, Fortune 500), which owns AOL. Time Warner is also the parent company of CNNMoney.com.
On the economic front, a report on the services sector due out after the market open is expected to show a slight decline in April.
Also, Federal Reserve Chairman Ben Bernanke is due to speak in New York about mortgage delinquencies and foreclosures.
In other corporate news, Deutsche Telekom AG is considering a bid to acquire Sprint Nextel (S, Fortune 500), according to a report in The Wall Street Journal.
Warren Buffett's Berkshire Hathaway (BRKA, Fortune 500) reported a 64% drop in quarterly profit late Friday. At the company's annual meeting this past weekend, the legendary investor warned investors to lower their expectations.
Oil prices rose on supply worries after an attack on a Shell oil station Nigeria. U.S. crude rose 58 cents to $116.90 a barrel in electronic trading.
In global trade, Hong Kong stocks finished lower while China stocks rebounded. European shares fell in midday trading. Markets in Japan and the U.K. were closed.
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