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Before the bell: Stocks set to drop ahead of more data, disappoinging earnings

Posted Oct 28th 2009 7:45AM by Melly AlazrakiMelly Alazraki RSS Feed
Filed under: Before the bell, International markets, Market matters, Economic data, Oil, Housing

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U.S. stock futures declined Wednesday morning a day after stocks mostly fell on mixed economic data and some earnings disappointments. Today is another busy day of earnings and economic releases, including durable goods orders and new home sales.

On Tuesday, U.S. stocks fell for a third straight session after a surprise drop in consumer confidence. Despite a good housing report, and even as the Dow's oil giants and IBM (NYSE: IBM) saved the Dow from finishing in the red (BP (BYSE: BP) on good earnings, and IBM increased its share repurchase plan), tech staged a selloff and the Nasdaq composite fell 1.2%. The S&P 500 fell 0.3%.

More economic releases are due out today ahead of the GDP report Thursday:
  • At 8:30 a.m. Eastern, September durable goods orders will be released. Economists expect an increase of 0.1%.
  • At 10:00 a.m. September new home sales will be reported and is expected to climb to a total of 440,000 units annual rate. If the report hits the number, it would the sixth consecutive monthly gain of new home sales and the best month for new home sales in more than a year as builders reap the benefits of a tax credit for first-time owners that expires at the end of next month.
  • At 10:30 a.m. weekly inventories are due out. This follows the American Petroleum Institute report on Tuesday that said that crude stocks fell 3.5 million barrels while analysts had expected a rise of 900,000 barrels, according to a survey by Platts, the energy information arm of McGraw-Hill Cos.Tuesday's Oil prices fell below $79 a barrel Wednesday amid mixed signals about the strength of the U.S. economic recovery and the dollar's gains against other major currencies.
Other than earnings, this morning's focus is also on GMAC Financial Services, which is seeking a third round of bailout funds from the Treasury Department ranging from $2.8 billion to $5.6 billion, according to the Wall Street Journal.

Overseas, Asian major markets fell by about 1.5 percent or more. European stocks dropped Wednesday, weighed down by earnings reports from companies including German business software maker SAP (NYSE: SAP), which cut its sales forecast.

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DJIA+30.6910,464.40
NASDAQ+6.872,176.05
S&P 500+4.981,110.63

Last updated: November 26, 2009: 11:13 AM

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