Before the bell: Futures edge lower ahead of CPI

Posted Jun 13th 2008 7:46AM by Melly Alazraki
Filed under: Before the Bell, Earnings Reports, Forecasts, Deals, Google (GOOG), Microsoft (MSFT), Yahoo! (YHOO), Coca-Cola (KO), Market Matters, US Airways Group (LCC), Economic Data, Housing

U.S. stock futures were mixed to lower early Friday morning as investors awaited data on inflation. News about companies cutting workforce and Yahoo!'s failed talks with Microsoft also soured the mood.

On Thursday, U.S. stocks closed with gains following a surprisingly strong retail sales, but the gains were tempered as the day went on due to rising oil prices and the Yahoo! announcement about the failed Microsoft talks.The Dow industrials ended 57 points, or 0.48%, higher, the S&P 500 rose 4 points, or 0.33%, and the Nasdaq Composite rose 10 points, or 0.43%.

What may yet change the atmosphere on Wall Street is the Consumer Price Index is scheduled for release at 8:30 a.m. EDT. Economists surveyed by Briefing.com expect CPI to show an increase of 0.5% in May following a 0.2% rise in April. Core CPI, which excludes the volatile food and energy prices, is expected to have risen 0.2% in May, after it rose 0.1% the month before.

At 10:00 a.m., the preliminary University of Michigan consumer confidence gauge for June is also due.

Meanwhile, foreclosures data was already released and the number of U.S. homeowners forced into foreclosure further last month, up nearly 50% compared with a year earlier,and up 7% from April, according to RealtyTrac Inc..

The main corporate headline this morning no doubt has to do with Yahoo! (NASDAQ: YHOO). The internet portal said talks with Microsoft Corp. (NASDAQ: MSFT) have ended and announced late Thursday an online ad partnership with Google Inc. (NASDAQ: GOOG), which could be worth $800 million in revenue. Yahoo said it believes the ad deal would be better than selling its search business to Microsoft, but some are concerned anti-trust issues would derail that deal too. Yahoo shares sank 10% on Thursday.

Also US Airways (NYSE: LCC) said that it's cutting capacity on routes by up to 8%, increasing fees and shedding 1,700 employees. LCC shares closed down nearly 16%.

And while we've grown accustomed to problems at automakers and airlines, as well as the occasional retailer, arising from the economic slowdown, it seems that even Coca Cola (NYSE: KO) is not immune. It may be active as Coca Cola Hellenic Bottling (NYSE: CCH) warned over 2008 earnings, citing economic conditions in Italy, Ukraine and Romania, adverse weather in Central Europe, rising plastic prices and a strike in Greece.

Tags: cch, featured, goog, ko, lcc, msft, yhoo