By Carla Mozee, MarketWatch
U.S. stocks may drop sharply when Wall Street opens Tuesday, as
equity futures were under heavy pressure, with a selloff in bond
markets calling the shots.
Futures for the Dow Jones Industrial Average (YMM5) dropped 146
points, or 0.8%, to 17,876, and those for the S&P 500 (ESM5)
fell 16 points, or 0.8%, to 2,082. Nasdaq futures (NQM5) were down
39 points, or 0.9%, at 4,392.25.
A downward move would extend Monday's losses for U.S., and
investors on Tuesday may see another drive lower in U.S. bond
prices following the battering European bonds were taking. The
widely watched yield on Germany's 10-year Bund was pushed above
0.7% early Tuesday. Bond and yields move inversely.
"Wall Street is being pulled around by the sentiment on the bond
markets. The latest rise in Treasury yields is adding to pressure
on equities. Again with little on the economic calendar today, we
could see this continue," said Richard Perry, market analyst at
Hantec Markets, in a note.
U.S. bond yields on Monday hit their highest level since early
December
(http://www.marketwatch.com/story/treasury-prices-decline-as-eurozone-bond-market-resumes-selloff-2015-05-11).
The yield on the 10-year Treasury note on Monday climbed to 2.267%,
according to Tradeweb.
Data: Economic reports on Tuesday's docket include the 9 a.m.
Eastern Time release of a small-business optimism index by the
National Federation of Independent Business. At 10 a.m., the Labor
Department is set to release figures on March job openings.
The Federal Reserve's report on first-quarter household debt and
credit is slated for release at 11 a.m. Eastern.
Federal Reserve member John Williams will give his assessment
about the prospects for the U.S. economy at a 12:45 p.m. speech at
the NY Association for Business Economics in New York. In a CNBC
interview Monday, Williams said the first quarter wasn't as weak as
it appears
(http://www.marketwatch.com/story/feds-williams-finds-a-reason-to-be-cheerful-about-first-quarter-2015-05-11).
Stocks to watch: Online real-estate services firm Zillow Group
Inc. (ZILLOW.XX) is forecast to report a first-quarter loss of 12
cents a share, according to a FactSet consensus estimate.
Drug distribution company McKesson Corp. (MCK) is expected to
post fiscal-fourth-quarter profit of $2.74 a share.
Late Monday, Rackspace Hosting Inc. (RAX) shares fell more than
10% as the cloud-based, web-hosting company's second-quarter
revenue outlook was below Wall Street estimates
(http://www.marketwatch.com/story/rackspace-shares-drop-after-revenue-miss-outlook-2015-05-11).
Gap Inc. (GPS) dropped more than 2% Monday evening after the
clothing retailer's first-quarter revenue missed FactSet analysts'
estimates.
Other markets: In Asia, the Shanghai Composite fell 1.1%, but
Japan's Nikkei Average edged up about 4 points. In Europe, the
Stoxx 600 stumbled 1.4%. Greece worries intensified after the
finance minister said the country may run out of cash in two
weeks.
The dollar (DXY) fell against its rivals and gold prices (GCM5)
were modestly higher. Oil futures (CLM5) shot higher, trading above
$60 a barrel.
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