U.S. stock futures point to slide after Thursday rally
The roller-coaster ride in equity markets looked set to continue on Friday, with U.S. stock futures trimming losses but still pointing to a lower opening after a strong push higher at the end of the previous session.
S&P 500 futures fell 7.40 points to 933.60 and Nasdaq 100 futures dropped 15.5 points to 1,307.50. Dow industrial futures dropped 95 points to 8,871.00.
Dow futures were down more than 200 points at one point Friday. Losses were trimmed after a further decline in Libor, a key short-term borrowing rate. A gradual decline in Libor rates this week has raised hopes that massive bank bailouts by European and U.S. governments will thaw frozen credit markets.
U.S. stocks closed Thursday with big gains, rallying into the close as bargain hunters stepped in following initial losses on data releases showing drops in factory output. The Dow Jones Industrial Average climbed 401 points, the Nasdaq Composite rose 89 points and the S&P 500 added 38 points.
Friday's session features what are likely to be two more gloomy reports, on housing starts for September and consumer sentiment for October.
"Both housing starts and building permits are expected to show steep declines in September, reflecting deteriorating financing condition, weaker housing demand and expectations of further house price declines," said Lena Komileva, economist at Tullet Prebon.
"U.S. consumer confidence is likely to have dropped sharply in October in reaction to rapid falls in equity prices, concern over the security of the financial system and a deteriorating labor market."
The automotive sector was back in the news and on investors' radar screens. Embattled General Motors Corp. (GM:General Motors Corporation News, chart, profile, more Last: 6.40+0.18+2.89%
4:01pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: GM 6.40, +0.18, +2.9%) and Chrysler LLC are picking up the pace on merger talks, pushed by banks and other lenders eager to see a deal, The Wall Street Journal reported. Meanwhile, bond insurers including Ambac Financial (ABK:AMBAC Inc News, chart, profile, more Last: 2.66+0.86+47.78%
4:00pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: ABK 2.66, +0.86, +47.8%) are working on a plan to send to the U.S. Treasury that would allow the firms to sell certain risky assets, Bloomberg News reported. The report cited Ambac's CEO. Oil futures crept off lows, up 90 cents to $70.75 a barrel. The dollar dropped against the Japanese yen, and December gold futures fell $10.10 to $794.40 an ounce. Ahead of the opening bell, oil-services giant Schlumberger Ltd. (SLB:Schlumberger Limited News, chart, profile, more Last: 53.20-1.20-2.21%
4:02pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: SLB 53.20, -1.20, -2.2%) matched expectations with third-quarter net income of $1.53 billion, or $1.25 a share, a 13% increase from the same period last year. Revenue climbed to $7.26 billion from $5.93 billion. Also on the earnings front, Google (GOOG:google inc cl a News, chart, profile, more Last: 353.02+13.85+4.08%
GOOG 353.02, +13.85, +4.1%) rose more than 10% in pre-opening trade after reporting late Thursday 26% profit growth for the third quarter, topping analyst estimates after the online-search leader cut expenses. Revenue rose 31%. The report "was slightly better than expectations, giving us a sigh of relief," wrote analysts Marianne Wolk and Malindi Davies at Susquehanna . "Top-line numbers were a bit better than expected, due - surprisingly -- to better than expected U.S. performance, while international growth was slightly lower." International Business Machines (IBM:International Business Machines News, chart, profile, more Last: 91.52+3.23+3.66%
4:01pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: IBM 91.52, +3.23, +3.7%) gave more details on its third-quarter earnings that showed a 22% profit increase, with CFO Mark Loughridge saying he remained "quite confident" that the company could hit its long-term goal of generating at least $10 in earnings per share for 2010. Honeywell International (HON:honeywell intl inc com News, chart, profile, more Last: 30.93+1.87+6.43%
4:00pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: HON 30.93, +1.87, +6.4%) said Friday that third-quarter earnings rose to $719 million, or 97 cents a share, compared to $618 million, or 81 cents a share, in the same period a year ago. Sales rose to $9.28 billion compared to $8.74 billion a year earlier. Analysts polled by FactSet Research estimated, on average, earnings per share of 95 cents on sales of $9.28 billion. Overseas, shares of Ericsson (ERIC:ericsson l m tel co adr b sek 10 News, chart, profile, more Last: 6.97+0.64+10.11%
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Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: ERIC 6.97, +0.64, +10.1%) rose in Stockholm after its half-owned Sony Ericsson mobile-phone venture reported a smaller-than-forecast third-quarter loss. The report was released after trading in Sony (SNE:sony corp adr new News, chart, profile, more Last: 23.74+0.29+1.22%
4:01pm 10/16/2008
Delayed quote dataAdd to portfolio Analyst Create alertInsider Discuss Financials Sponsored by: SNE 23.74, +0.29, +1.2%) had closed in Tokyo. International stocks played catch-up with the U.S. rally. The Nikkei 225 climbed 2.8% in Tokyo to end the week, and the FTSE 100 rose 2% in London.
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