Monday, April 13, 2009

US Stock Futures Point To Weak Open On Earnings Worries, GM Drags

. Monday, April 13, 2009

By stockOzone team

US stock futures declined on Monday as investors remained nervous ahead of bank earnings. Stocks also retreated on reports that struggling automaker General Motors may file for bankruptcy.

At 8:21 am ET, Standard & Poor's 500 Index futures fell 5.90 points to 846.70. Dow Jones Industrial Average futures increased 33 points to 7970. Nasdaq Composite Index futures retreated 5.50 points to 1330.50.

Inveators remained anxious as three major US banks are due to report quarterly results this week. Goldman Sachs (NYSE: GS) reports on Tuesday, JPMorganChase (NYSE: JPM) and Citigroup (NYSE: C) are due to report on Thursday and Friday, respectively.

The New York Times on Sunday reported that U.S. Treasury is directing embattled automaker General Motors Corp. (NYSE: GM) to prepare the groundwork for a bankruptcy filing by a June 1 deadline, despite the company's contention that it could still reorganize outside court.

Goldman Sachs (NYSE: GS) on Monday announced that it has raised around $5.5 billion for a new fund designed to purchase private-equity investments at a discount on the secondary market.

Express Scripts Inc. (NASDAQ: ESRX) said that it has acquired health insurer WellPoint Inc.'s (NYSE: WLP) pharmaceutical benefit management subsidiaries for $4.68 billion.

Indian mid sized IT outsourcer Tech Mahindra won an auction for a controlling stake in fraud hit Satyam Computer Services Ltd (NYSE: SAY).

According to the Wall Street Journal, U.S. banks that received money under the Troubled Asset Relief Program are facing a probe over increases in rates and fees on a range of routine transactions, including credit cards.

Meanwhile, Seagate Technology (NASDAQ: STX) said Monday that for fiscal third quarter, it expects to report unit shipments of approximately 39 million for the third quarter and revenue of approximately $2.1 billion, exceeding the company's original outlook of $1.6 billion to $2.0 billion. Gross margin is expected to be approximately 7% to 7.5%, which is better than the earlier forecast of the company.

On Thursday, airplane maker Boeing (NYSE: BA) announced that it will cut back production of its 777 model at its Everett plant from seven planes a month to five and delay a plan to ramp up production of its 747 and 767 models. The move prompted credit rating Company Standard & Poor’s to place some of Boeing Co.’s long-term credit ratings on the “credit watch negative”list with“negative implications.”

Overseas, Asian markets settled mixed while European stocks were trading up in afternoon trade.

Disclosure: Author does not own any of the stocks discussed here.

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