futures find footing Stock futures creep higher as oil...

futures find footing Stock futures creep higher as oil falls

DuPont, Dow Chemical downgraded on economic growth concerns
By Steve Goldstein, MarketWatch
Last Update: 8:15 AM ET Jun 7, 2006


LONDON (MarketWatch) -- Stock market futures crept higher on Wednesday on optimism markets can recover from Federal Reserve's Chairman Ben Bernanke's hawkish interest-rate comments, with an upbeat statement on semiconductor sales growth and declining oil prices providing a boost.
S&P 500 futures rose 2.7 points at 1,268.40 and Nasdaq 100 futures improved 5.5 poitns at 1,583.00.
The Dow industrials ended 46 points lower Tuesday, bringing two-day losses to nearly 250 points after Bernanke said recent core inflation readings were at or above the upper end of a range consistent with price stability.
That's led to speculation that the Fed at its June meeting will raise rates for the seventeenth straight time, rather than hold its key interest rate at 5%. Markets also are uncertain how high the Fed will go in its rates campaign after the June meeting.
Francois Trahan, an analyst at Bear Stearns, added that the global economic picture is also undermining stocks.
"As far as June 5 is concerned, a fair assessment of the market behavior over the past few weeks will quickly show that the major indices were already substantially off long before the Fed chairman's comments hit the tape," Trahan said.
"The bottom line is that the downturn in equity markets over the past month has occurred coincident with a slowdown in economic prospects."
Deutsche Bank analysts evidently feel the same way, downgrading a number of chemical companies, including DuPont (DDE.I. du Pont de Nemours and Company
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Overseas, the Nikkei 225 ended at a six-month low, while European stock markets wobbled between positive and negative territory. See Asia markets. See Europe markets.
The dollar started picking up ground as traders in New York filtered in, with the dollar up in particular against the euro.
Crude-oil futures weakened 74 cents at $71.76 ahead of weekly supplies figures, due out at 10:30 a.m. Eastern. See story.
Meanwhile, stronger-than-expected semiconductor demand for cellular phones and other consumer electronics prompted the Semiconductor Industry Association to boost its projection of chip sales in 2006 to growth of 9.8% from a previous forecast of 7.9%. The trade group now sees sales of $249.6 billion this year, compared with the previous forecast, issued in November 2005, of $245 billion.