Market cautious before quarterly GDP
David Russell | [email protected]
S&P 500 futures are falling about one-quarter of a percent, while European indexes are down by half a percent or more. Asia was mixed but mostly lower overnight as Shanghai and Tokyo both declined.
Equities have bounced smartly in the last week, rebounding from their biggest drop of the year. A focus on corporate earnings, rather than economic news, supported the rebound. But attention now returns to the bigger picture, with the release of first-quarter gross domestic product at 8:30 a.m. ET. Next week's calendar brings key reports such as the Institute for Supply Management's index on Wednesday and non-farm payrolls on Friday. Both missed expectations last month by a wide margin.
The S&P 500 is also vying with long-term resistance from its previous all-time high in 2007, and has been trapped around its current level since mid-March. Most European indexes have gone nowhere all year.
Trading in the foreign-exchange and commodity markets shows the typical correlations for a bearish open: Oil, copper, the euro and the Australian dollar are lower, while the Japanese yen is up across the board. Precious metals and agricultural foodstuffs are mixed but mostly lower.
Several companies have moved in extended-hours trading after reporting quarterly results. Touch-screen maker Synaptics is climbing after beating expectations, issuing strong guidance, and announcing that it had won supply contracts with Samsung. Homebuilder D.R. Horton rose as well.
Chinese Internet stock Baidu is lower after its profit and revenue lagged consensus. Expedia initially rose on a strong report but then fell after management lowered growth targets. Semiconductor-equipment company KLA Tencor also fell after predicting weak orders.