Economic concerns weigh on stocks
David Russell | [email protected]
S&P 500 futures are down by more than half a percent at the time of this writing, following losses of similar magnitude in Europe. Asian indexes declined more than 1 percent overnight amid a rally in the Japanese yen.
Attention now focuses on the U.S. Commerce Department's initial estimate of third-quarter gross domestic product at 8:30 a.m. ET. Economists expect consumer spending to lift growth to 1.9 percent from 1.3 percent in the second quarter. The news comes against a backdrop of weakening data in Europe and poor forecasts by companies this earnings season.
Stocks have already been retreating from their highest levels in more than four years, and a weak GDP report could intensify the selling pressure. Durable-goods orders and existing-home sales both trailed estimates yesterday.
Commodities and currencies are also painting a picture of risk aversion. Oil, gold, and copper are down by half a percent, while silver is down a full percentage point. The euro, Canadian dollar, and Australian dollar are lower, while the yen is stronger across the board.
In company-specific news, tech giants Apple and Amazon.com reported mixed quarterly results after the bell yesterday. AAPL's earnings beat expectations slightly but issued guidance that was below consensus forecasts, while AMZN's results missed by a narrow margin. In both cases, investors were placated by hopes of future products, causing the shares to recover from initial declines in post-market trading.
Deckers Outdoor is indicated to open sharply lower on weak sales of its UGG boots. VeriSign is also lower after cutting guidance, while online travel agency Expedia is up following its third strong quarterly report in a row.