Market Commentary and Intraday News
Stocks May Come Under Pressure On Disappointing Earnings News - U.S. Commentary
211 days ago
(RTTNews) - With traders reacting negatively to the latest batch of earnings news, stocks are likely to come under pressure in early trading on Tuesday. The major index futures are pointing to a sharply lower open for the markets, with the Dow futures down by 153 points.
The downward momentum for the markets comes on the heels of some disappointing earnings news, with some big-name companies reporting weaker than expected quarterly results.
Chemical giant DuPont (DD) is likely to come under pressure after reporting weaker than expected third quarter results. The company also unveiled plans to cut about 1,500 jobs and issued a downbeat forecast for the full year.
3M Co. (MMM) reported third quarter earnings that matched analyst estimates but on weaker than expected revenues. The diversified manufacturer also lowered its full-year earnings guidance.
Chip maker Texas Instruments (TXN) reported better than expected third quarter results but forecast fourth quarter earnings and revenues well below analyst estimates.
Peter Boockvar, managing director at Miller Tabak, said, "Central bank money printing can only suspend reality for so long as we've seen time and again that economic growth is not driven by ever cheaper money when deleveraging and policy incompetence rule the day."
"At least until the November election, the earnings story will continue to drive markets as it has since the Monday after the FOMC EQE (endless QE) news," he added.
Not all of the earnings news was bad, however, with online media giant Yahoo (YHOO) moving higher in pre-market trading after reporting better than expected third quarter results.
Stocks managed to eke out slim gains on Monday after a lackluster session that saw losses for most of the day. A late-day surge reversed earlier weakness.
The major averages moved to the upside going into the close, ending the day in positive territory. The Dow rose 2.38 points to 13,345.89, while the S&P 500 edged up less than a point to 1,433.82. The Nasdaq posted a gain of 11.33 points, ending the day at 3,016.96.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday. While Japan's Nikkei 225 Index and Australia's All Ordinaries Index both closed just above the unchanged line, China's Shanghai Composite Index fell by 0.9 percent.
Meanwhile, the major European markets have all shown notable moves to the downside on the day. The U.K.'s FTSE 100 Index has tumbled by 1.3 percent, while the German DAX Index and the French CAC 40 Index are plunging 1.6 percent and 1.7 percent, respectively.
In commodities trading, crude oil for December delivery is falling $1.57 to $87.08 a barrel in its first day of trading as the front month contract. Gold futures are down $15.20 at $1,711.10 an ounce. In the previous session, the precious metal rose $2.30 to $1,726.30 an ounce.
On the currency front, the U.S. dollar is currently trading at 79.82 yen compared to the 79.95 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.2970 compared to yesterday's $1.3060.
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