By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- U.S. stock futures pointed to a lower
open for Wall Street, with investors looking set to spend another
session booking profits on recent gains, as earnings season
looms.
Futures for the Dow Jones Industrial Average (DJZ4) fell 62
points, or 0.4%, to 16,841, while those for the S&P 500 index
(SPZ4) dropped 7.3 points, or 0.4%, to 1,948.70. Futures for the
Nasdaq-100 index (NDZ4) fell 14.50 points, or 0.4%, to
3,992.25.
Trading was choppy on Monday, with the S&P 500 (SPX) closing
down 0.2% to 1,964.82, and the Russell 2000 (RUT) falling nearly a
full 1%. The S&P 500 dropped below its 50-day moving average
last week and has yet to move back above that level. Read: U.S.
stocks test key technical levels
Tuesday's light data schedule includes August job openings at 10
a.m. Eastern Time and August consumer credit at 3 p.m. Eastern
Time.
Minneapolis Fed President Narayana Kocherlakota, a voting member
of the Fed policy committee this year, will give a speech on
"clarifying the objectives of monetary policy" in Rapid City, South
Dakota, at 2:30 p.m. Eastern Time. Simon Potter, head of the
markets group at the New York Fed, will speak at a conference in
New York at 4:30 p.m. Eastern.
Kansas City Fed President Esther George said in a speech in
Albuquerque, N.M. on Monday that "the time had come" for Fed
officials to start talking seriously about lifting short-term
rates, The Wall Street Journal reported.
Braced for earnings: Yum Brands Inc. (YUM) will report quarterly
results after the close Tuesday, but the third-quarter reporting
season for earnings gets underway next week. Alcoa Inc. (AA) will
report Wednesday.
Burt White, chief investment officer at LPL Financial, and
Jeffrey Buchbinder, market strategist at the same company, said in
a note Tuesday they expect "another good earnings season" that is
likely to boost stocks.
They listed several reasons for optimism on the current
reporting season: U.S. economic growth has picked up; upside
earnings surprises have been typical since summer 2009; the
Institute for Supply Management Manufacturing Index, which has a
strong track record of predicting earnings growth six months out,
has shown solid growth territory the last six months; and there
have been few signs of cost pressures. Also 'Sell Rosh Hashanah,
buy Yom Kippur' worked this year.
Stocks to watch: The Container Store Inc. (TCS) shares fell 15%
in light premarket volume, extending their slide late Monday after
the storage-organization retailer cut its profit and sales
view.
The European Commission has opened an investigation into Amazon
Inc.'s (AMZN) tax arrangement in Luxembourg. Amazon shares were off
1% in low volume ahead of the bell.
Agco Corp. (AGCO) shares stumbled 11% before the market opened
as the agricultural equipment company cut its profit outlook for
the year because of weaker-than-expected demand.
Other markets: European markets tracked stock futures lower
after another round of downbeat German data. Asian stocks had a
mixed session, with the Nikkei 225 index down 0.7%, but Hong Kong's
Hang Seng Index rose 0.5%. Gold prices (GCZ4) stayed just above the
key $1,200-an-ounce level. Oil futures (CLX4) slipped, remaining
below $91 a barrel.
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