stock futures lower ahead of retail data

Stock Futures Lower Ahead of Retail Data
Tuesday June 13, 7:31 am ET
Stock Futures Lower Ahead of Retail and Inflation Data; Overseas Markets Sell Off


LONDON (AP) -- Stock market futures were pointing to further losses on Tuesday, with traders waiting to see if data on retail sales and wholesale inflation reinforces rate-hike and economic growth worries or quashes them.

S&P 500 futures weakened 4.4 points at 1,242.50 and Nasdaq 100 futures dropped 4.25 points at 1,537.00.

The Dow industrials finished 99 points lower, and the S&P 500 and Nasdaq Composite indexes dropped even more on a percentage basis ahead of the week's inflation data.

Overseas markets, particularly in Japan, also sold off on Tuesday.

One speech from Federal Reserve Chairman Ben Bernanke late Monday passed without comments that touched on interest-rate policy, but on Thursday the Fed chief will get another chance to steer market expectations.

The key releases of Tuesday are retail sales and producer prices in May, both due at 8:30 a.m. Eastern. The key consumer price figures are due out Wednesday.

Most analysts are predicting a weak 0.1 percent gain in overall retail sales but a more-robust climb of 0.5 percent when auto sales are taken out. Higher gasoline prices have taken away consumers' appetites for buying cars, analysts say.

Most economists are expecting a tame 0.2 percent for the core PPI number. For the full number, consensus expectations are for a bigger gain, of 0.5 percent.

Also due for release are earnings results from Goldman Sachs and Best Buy.

If the market response to Lehman Brothers results on Monday are any indicator, traders will be looking for clues as to whether Goldman can sustain its earnings growth. Lehman Brothers dropped over 5 percent even after reporting a 47 percent profit improvement.

Elsewhere, oil futures continued to weaken in electronic trade, as Tropical Storm Alberto looks set to miss key oil production platforms in the Gulf of Mexico.

The euro edged up against the dollar, even as a poll of German investor sentiment dropped more sharply than forecasted.

On the brokerage front, J.P. Morgan upgraded technology-products distributor Tech Data Corp from underweight to neutral, citing valuation. The broker told clients that the company has struggled over the past several years in Europe and that this had been the primary reason for the underweight rating.

Banc of America Securities upgraded oil refiners Sunoco and Western Refining, citing valuation.

Overseas, Bayer scrambled to win three-quarters control of German drugmaker Schering ahead of a Wednesday deadline. Bayer is struggling to reach that milestone as rival German drugmaker Merck KGaA, which isn't affiliated with the American drugmaker of the same name, has built up a stake in Schering over the last week.

Mittal Steel's quest to win control of the world's number two steelmaker took another step after the publication of a profit forecast from 2006 to 2008.