By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- U.S. stock futures were weak on Monday
as global equity investors were concerned about a slowdown in China
ahead of HSBC's PMI data.
A decline in economic activity in August, measured by Chicago
Federal Reserve contributed to the sour mood on Wall Street.
Futures for the Dow Jones Industrial Average (DJZ4) fell 40
points, or 0.2%, to 17,172, while those for the S&P 500 index
(SPZ4) lost 7.1 points, or 0.4%, to 1,996.70. Tech futures were
pointing to even bigger opening losses later, with Nasdaq-100
(NDZ4) futures off 15 points, or 0.4%, to 4,077. Read: Russell 2000
'death cross' looms
U.S. economic activity was lackluster in August, according to
data released Monday. Home sales for August are due at 10 a.m.
Eastern. A couple of Fed speakers are also on the calendar, with
New York Fed President William Dudley due to speak at Bloomberg
Markets Most Influential Summit at 10 a.m. Eastern. Dudley is a
voting member of the Fed policy committee.
At 7:30 p.m. Eastern, Minneapolis Fed President Narayana
Kocherlakota, also a voting member, will give a speech on the
objectives of monetary policy to the Economic Club of Marquette
County.
Clues about the Fed's timing intention on hiking rates and news
from China are what traders will be looking out for, said Joao
Monteiro, analyst at Valutrades.
China worries festering: Hong Kong's Hang Seng Index fell to
two-month lows on Monday as traders worried ahead of the HSBC
estimate for China's September purchasing managers index, due after
the close of U.S. markets.
Any number under 50 -- indicating contraction -- could mean more
losses for Asia markets, especially barring meaningful stimulus
measures. At a G-20 meeting over the weekend, China's Finance
Minister Lou Jiwei said country is facing downward pressure, but
won't "make major policy adjustments" due to changes in any
individual economic indicator.
"We're not going to see this wall of money thrown at the Chinese
slowdown," Stuart Beavis, head of institutional equity derivatives
at Vantage Capital Markets in Hong Kong, told Bloomberg News.
U.S. stocks finished a volatile session on Friday mixed, but the
Dow industrials (DJI) notched their 18th record close this year.
Alibaba Group Holding Ltd. (BABA) was the big spotlight for that
session, soaring 36% in its debut.
Stocks to watch: Investors may continue to watch shares of
Alibaba for further action on Monday. The IPO is now officially the
world's biggest as bankers are exercising their option to sell more
shares, Dow Jones Newswires reported Sunday, citing unnamed
sources.
Shares in Apple, Inc.(AAPL) rose 0.8% in premarket trade, after
the company said iPhone 6 sales topped 10 million during the first
weekend, a new record for the company.
AutoZone Inc. (AZO) reported fiscal-fourth quarter earnings that
topped estimates, but sales were slightly below forecasts. Shares
were off 1.1%.
Dresser-Rand Group Inc. (DRC) gained 2.3% in premarket trade
after German engineering company Siemens AG announced a dealto buy
the U.S. oil-equipment maker for $7.6 billion.
Shares of Sigma-Aldrich Corp. soared 35% in premarket trade
after Merck & Co. Inc. (MRK) said Monday it will pay $140 per
share for the life-science and technology company, a price that
values the company at around $17 billion.
Other markets: Silver (SIZ4) prices recovered earlier losses,
after hitting four-year lows on Monday on dollar strength. Gold
(GCZ4) prices edged higher, adding 50 cents to $1,217 an ounce. The
dollar itself softened a bit on profit-taking.
In London, shares of U.K. grocer Tesco PLC fell more than 8%
after a profit warning due to an accounting error. China worries
took a toll on mining shares, cutting into the FTSE 100 index ,
with other European indexes also down.
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