Stock Futures Gain After Sell-Off
U.S. stock index futures rose on Thursday as investors looked for buying opportunities after a sell-off that has driven the S&P 500 down 3 percent for the week.
U.S. stocks sagged Wednesday as civil unrest intensified in Greece and fears grew that the Greek debt crisis could spread to other European economies. The euro hit a 14-month low as investors shunned the debt of weaker euro zone countries and jumped into safe havens like U.S. Treasury prices and the dollar.
Investors will focus on weekly first-time claims for jobless benefits due from the Labor Department at 8:30 a.m. EDT. Economists in a Reuters survey forecast a total of 440,000 new claims, compared with 448,000 in the prior week.
The Labor Department also releases preliminary first-quarter productivity and unit labor cost data at 8:30 a.m. EDT. Economists look for a rise of 2.5 percent in productivity versus a 6.9 percent increase in the prior period. Unit labor costs are expected to fall 0.7 percent compared with a 5.9 decline in the previous report.
Kraft Foods Inc is due to report quarterly results, and analysts expect earnings of 45 cents per share, unchanged from a year ago, according to Thomson Reuters I/B/E/S.
S&P 500 futures were up 2.9 points and above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 20 points, while Nasdaq 100 futures rose 2.75 points.
German Chancellor Angela Merkel said Wednesday Europe's fate was at stake, while France declared the euro was under speculative attack but that the attempts would fail. The Greek government vowed not to retreat a single step despite violent protests against the government's plan to force spending cuts.
The European Central Bank will be under pressure on Thursday to show it can stop the Greek crisis from engulfing other euro zone member states. The central bank is expected to hold rates at a record low of 1.0 percent.
Sunday, May 2, 2010
U.S. stock market lacks conviction after another up month
Many investors "are still not convinced the recovery is for real," said Kevin Mahn, portfolio manager of the SmartGrowth Mutual Funds. He points to strong fund flows into U.S. Treasurys, typically sought as a safe place to protect principal in uncertain times, "as symbolic of where market and investor sentiment is right now.
That lack of conviction, he said, is made worse by the uncertainty that comes with sovereign debt concerns and reports of a federal criminal investigation of investment bank Goldman Sachs Group Inc. /quotes/comstock/13*!gs/quotes/nls/gs (GS 145.20, -15.04, -9.39%) .
On Friday, the bulls turned tail, with the S&P 500 /quotes/comstock/21z!i1:in\x (SPX 1,187, -20.10, -1.67%) sliding 1.7% to 1,187, leaving it down 2.5% for the week as Goldman Sachs and other worries weighed, especially on the financial sector.
But the broad market gauge still gained in April, up 1.5%. That's better than April's historic average return of 1.3%, according to Stovall.
May, on the other hand, has to contend with its questionable past performance.
The S&P 500 "hasn't fared too well since 1928, as it posted a slight decline on average, ranking it only number 10 of 12 months," Sam Stovall, chief investment strategist at Standard & Poor's, wrote Friday in a note.
The S&P 500 could suffer as much as a 10% to 15% correction, but the pullback would likely not bring an end to the current bull market, Stovall and his colleagues believe.
May's somewhat dismal ranking can be misleading. The index's relative performance in May has been climbing over the decades, placing in the eighth spot if one only looks back to 1945, and rising to an even loftier sixth position since 1970.
Better yet, May has been the best-performing month of the year since 1990, casting a more bullish light on the month that conjures the adage "Sell in May."
Crude-oil prices gained 2.8% in April, while gold settled at a four-month high, rising m nearly 6% during the month.
Many investors "are still not convinced the recovery is for real," said Kevin Mahn, portfolio manager of the SmartGrowth Mutual Funds. He points to strong fund flows into U.S. Treasurys, typically sought as a safe place to protect principal in uncertain times, "as symbolic of where market and investor sentiment is right now.
That lack of conviction, he said, is made worse by the uncertainty that comes with sovereign debt concerns and reports of a federal criminal investigation of investment bank Goldman Sachs Group Inc. /quotes/comstock/13*!gs/quotes/nls/gs (GS 145.20, -15.04, -9.39%) .
On Friday, the bulls turned tail, with the S&P 500 /quotes/comstock/21z!i1:in\x (SPX 1,187, -20.10, -1.67%) sliding 1.7% to 1,187, leaving it down 2.5% for the week as Goldman Sachs and other worries weighed, especially on the financial sector.
But the broad market gauge still gained in April, up 1.5%. That's better than April's historic average return of 1.3%, according to Stovall.
May, on the other hand, has to contend with its questionable past performance.
The S&P 500 "hasn't fared too well since 1928, as it posted a slight decline on average, ranking it only number 10 of 12 months," Sam Stovall, chief investment strategist at Standard & Poor's, wrote Friday in a note.
The S&P 500 could suffer as much as a 10% to 15% correction, but the pullback would likely not bring an end to the current bull market, Stovall and his colleagues believe.
May's somewhat dismal ranking can be misleading. The index's relative performance in May has been climbing over the decades, placing in the eighth spot if one only looks back to 1945, and rising to an even loftier sixth position since 1970.
Better yet, May has been the best-performing month of the year since 1990, casting a more bullish light on the month that conjures the adage "Sell in May."
Crude-oil prices gained 2.8% in April, while gold settled at a four-month high, rising m nearly 6% during the month.
Saturday, May 1, 2010
US Stock Futures Trim Gains After GDP
U.S. stock futures trimmed their modest gains Friday after first-quarter gross domestic product grew slightly less than expected and U.S. labor costs rose incrementally.
After the report, Dow Jones Industrial Average futures were up 5, while Standard & Poor's 500-share index futures rose less than one point and Nasdaq Composite futures edged up two points. Prior to the data, Dow futures had been up 17, while S&P futures climbed 2 and Nasdaq futures advanced 4.
The Dow is on track to close up for the third month in a row, despite some turbulent days when instability in Greece and news of the fraud charges against Goldman Sachs roiled markets. The measure has gained over 12 of the last 14 months.
The Commerce Department said Friday that the U.S. first-quarter GDP rose at a 3.2% annual rate January through March, slightly below the 3.3% growth expected by economists surveyed by Dow Jones. But encouragingly, the growth was driven by businesses stocking up on goods for a strengthening consumer demand stoked by the lowest core inflation number in 51 years.
Meanwhile, the employment cost index rose 0.6% in the first quarter of 2010, the Labor Department said in a report Friday. Wages and salaries grew 0.4%. Economists had expected the employment cost index would climb by 0.4%.
Indications of the global economic recovery were bleaker. Spain's jobless rate rose to over 20% in the first quarter as the euro-zone jobless rate held at 10% in March.
The euro strengthened against the dollar after Greece agreed with the International Monetary Fund and the European Union to take additional austerity measures expected to yield "around EUR23 billion" ($30 billion) as a precondition for financial assistance, a Greek official familiar with the talks on aid said.
Two weeks after the Securities and Exchange Commission filed civil fraud charges against Goldman Sachs Group, federal prosecutors in the Manhattan U.S. Attorney's Office launched their own criminal investigation into whether the company or its employees committed securities fraud in connection with its mortgage trading, sending Goldman Sachs shares down 4.3%, in premarket trading.
American depositary shares of Barclays PLC dropped 6% in premarket trades after the U.K. bank reported a 29% profit rise that disappointed analysts, particularly as the group's fixed income division didn't match some peers.
Energy giant BP PLC rose 1.1% while Transocean fell 2.6% in early premarket action, following their steep losses as analysts debate the costs from the oil spill in the Gulf of Mexico. BP's market capitalization has dropped by around $25 billion since a rig fire was announced.
On Friday the oil spill reached the Louisiana coast.
The White House indicated Friday that new domestic offshore oil drilling will be on hold until the investigation of the Gulf of Mexico disaster is complete.
U.S. stock futures trimmed their modest gains Friday after first-quarter gross domestic product grew slightly less than expected and U.S. labor costs rose incrementally.
After the report, Dow Jones Industrial Average futures were up 5, while Standard & Poor's 500-share index futures rose less than one point and Nasdaq Composite futures edged up two points. Prior to the data, Dow futures had been up 17, while S&P futures climbed 2 and Nasdaq futures advanced 4.
The Dow is on track to close up for the third month in a row, despite some turbulent days when instability in Greece and news of the fraud charges against Goldman Sachs roiled markets. The measure has gained over 12 of the last 14 months.
The Commerce Department said Friday that the U.S. first-quarter GDP rose at a 3.2% annual rate January through March, slightly below the 3.3% growth expected by economists surveyed by Dow Jones. But encouragingly, the growth was driven by businesses stocking up on goods for a strengthening consumer demand stoked by the lowest core inflation number in 51 years.
Meanwhile, the employment cost index rose 0.6% in the first quarter of 2010, the Labor Department said in a report Friday. Wages and salaries grew 0.4%. Economists had expected the employment cost index would climb by 0.4%.
Indications of the global economic recovery were bleaker. Spain's jobless rate rose to over 20% in the first quarter as the euro-zone jobless rate held at 10% in March.
The euro strengthened against the dollar after Greece agreed with the International Monetary Fund and the European Union to take additional austerity measures expected to yield "around EUR23 billion" ($30 billion) as a precondition for financial assistance, a Greek official familiar with the talks on aid said.
Two weeks after the Securities and Exchange Commission filed civil fraud charges against Goldman Sachs Group, federal prosecutors in the Manhattan U.S. Attorney's Office launched their own criminal investigation into whether the company or its employees committed securities fraud in connection with its mortgage trading, sending Goldman Sachs shares down 4.3%, in premarket trading.
American depositary shares of Barclays PLC dropped 6% in premarket trades after the U.K. bank reported a 29% profit rise that disappointed analysts, particularly as the group's fixed income division didn't match some peers.
Energy giant BP PLC rose 1.1% while Transocean fell 2.6% in early premarket action, following their steep losses as analysts debate the costs from the oil spill in the Gulf of Mexico. BP's market capitalization has dropped by around $25 billion since a rig fire was announced.
On Friday the oil spill reached the Louisiana coast.
The White House indicated Friday that new domestic offshore oil drilling will be on hold until the investigation of the Gulf of Mexico disaster is complete.
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