By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- U.S. stock futures slipped Monday, with
the Dow Jones Industrial Average set up to push further below
17,000, while deal news sent shares of Family Dollar Stores Inc.
soaring in premarket.
Home-sales data will kick off a busy few days for economic
updates, the biggest of which will be payrolls on Friday. Investors
will also get a Federal Open Market Committee decision
mid-week.
Futures for the Dow Jones Industrial Average (DJU4) fell 21
points to 16,873, while those for the S&P 500 index (SPU4) fell
2.2 points to 1,969.20. Futures for the Nasdaq-100 index (NDU4)
were off 2.25 points to 3,953.25.
Pending home sales for June will be released at 10 a.m. Eastern
Time. The pace of data speeds up as the week continues. Between
Wednesday and Friday, investors will get second-quarter gross
domestic product, a Fed decision and July payrolls among other
economic items of importance. Get ready for 48 hours of economic
fury
Some market apprehension for Monday could be understandable
after Wall Street's performance on Friday, which saw the Dow
industrials (DJI) drop below 17,000. The benchmark lost 123.23
points, or 0.7%, to 16,960.57, weighed down by losses in Visa Inc.
(V). For the week, the blue-chip index fell 0.8%, its biggest
weekly loss since June 14.
The S&P 500 (SPX) closed 9.6 points, or 0.5%, lower at
1,978.34 and finished the week more or less where it started, while
the Nasdaq Composite (RIXF) managed a weekly gain of 0.4%.
Fears of a bubble-bursting won't rest, said Joao Monteiro,
analyst at Valutrades. "This story may be looking a little
over-brokered, but with the quiet summer sessions lying ahead, even
just a small shock could be all it takes to precipitate a big
move," he said in a note to clients. Also read: Stock trader who
called three crashes sees 20% collapse
Goldman Sachs on Friday cut its three-month view on global
stocks to neutral, over concerns a temporary bond selloff could hit
equities.
The analysts maintained an underweight on the U.S. on both a
three-and 12-month basis. "We expect reasonable returns for the
U.S. on an absolute basis over the coming year, but relative to
other markets, the longer-term recovery potential is smaller given
already high margins and strong performance so far," said the
analysts.
Mid-July, Goldman raised its year-end target for the S&P 500
index to 2,050 from 1,900, making the investment bank one of the
most bullish on Wall Street.
Stocks on the move Monday included Family Dollar Stores(FDO), up
22% in thin premarket trading after Dollar Tree Inc. (DLTR) said it
would buy the rival discount retailer for $74.50 a share, a roughly
23% premium over Family Dollar's closing price on Friday. Dollar
Tree shares were up around 5%.
El Pollo Loco Holdings Inc. (LOCO) surged 12% in premarket. The
Mexican fast-food chain soared 61% in its Nasdaq debut on
Friday.
Among Monday's earnings reports, Tyson Foods (TSN) posted
earnings that missed Wall Street views, although revenue topped
foercasts. Tyson shares inched higher in premarket. Coach (COH)
will also report ahead of the market open.
In Europe on Friday, LVMH Moët Hennessy Louis Vuitton shares
tumbled nearly 7% after the luxury-goods group posted a 4% fall in
first-half profit, citing negative effects from exchange rates.
That news knocked Europe's entire luxury-goods sector.
Herbalife Ltd. (HLF) will report after the close on Monday.
Follow more of the day's notable movers here.
Across other markets, Hong Kong's Hang Seng Index closed at
highs not seen in more than three years on Monday, after reports
that a plan to allow direct stock trading between Hong Kong and
Shanghai could be launched mid-October. European stocks had trouble
making headway as U.S. stock futures leaned south.
Oil prices (CLU4) pushed lower, while gold (GCU4) was a touch
higher, and the U.S. dollar index(DXY), which measures the
greenback against a basket of six other currencies, was largely
steady.
More must-reads from MarketWatch:
Behind the wild collapse in small-cap stocks
What the M&A surge says about the stock market
Buy-and-hold investing is impossible
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