U.S. stock futures seemed to indicate a higher open for what could be the first positive day on Wall Street this month. The global credit crunch may be affecting the stance of central banks around the world just as OPEC decided to make no changes in production. Despite increasing oil prices, the more dovish stance taken by central banks influenced investors' sentiment more. Also in focus today is economic data that investors hope could support a half point rate cut.Yesterday, U.S. stocks ended lower for the second straight day after Nokia and Merck disappointed investors with their respective outlooks and concerns about the credit-market crisis resumed. The Dow industrials fell 65 points, or 0.49%, the S&P 500 fell 9 points, or 0.65%, and the Nasdaq Composite lost 17 points, or 0.66%.
Several economic indicators are due for release today:
- Productivity data for the third quarter will be released at 8:30 a.m. EST, with consensus calling for productivity levels to rise.
- At 10:00 a.m. EST, October factory orders and November ISM services index are due out.
- Finally, weekly crude inventory numbers will be reported today as well.
Oil will continue to be in focus this morning as prices reached near $90 a barrel. Still, after the Bank of Canada eased rates yesterday and the Bank of Australia sounded more dovish, investors are looking forward to tomorrow's decision by the European Central Bank and the Bank of England. Recent data from Europe and the U.K. could add to the pressure on these banks to ease rates. The Federal Reserve meets next week and most on Wall Street believe another rate cut is in the cards, with many hoping the Fed will lower rates by half, rather than a quarter, point.
Already the dollar was stronger against the pound, the euro, the yen and the Canadian dollar.
Overseas, Asian markets finished higher. European stocks are also rising.
In corporate news:
Fannie Mae (NYSE: FNM) said today it is cutting its stock dividend to 35 cents a share from 50 cents a share beginning the first quarter of 2008, as well as offering $7 billion in non-convertible preferred stock. FNM shares are down some 1.75% in premarket trading.
Comcast (NASDAQ: CMCSA) shares are down nearly 7.4% in premarket trading after the company lowered its forecast for 2007 cable revenue growth to about 11% from at least 12% due to "challenging economic and competitive environment."
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