By Barbara Kollmeyer, MarketWatch
MADRID (MarketWatch) -- U.S. stock futures dipped on Monday,
threatening a continuation of losses for the Dow Jones Industrial
Average after the index dropped below the key 17,000 level last
week.
Home-sales data will kick off a busy few days for economic
updates, the biggest of which will be payrolls on Friday, while
investors will also get a Federal Open Market Committee decision
mid-week. And while the earnings schedule for Monday is lighter --
Tyson Foods Inc. and Coach Inc.--the rest of the week will deliver
plenty of big names.
Futures for the Dow Jones Industrial Average (DJU4) eased 6
points to 16,885, while those for the S&P 500 index (SPU4) fell
1 point to 1,970.40. Futures for the Nasdaq-100 index (NDU4) was
flat at 3,955.50.
Pending home sales for June will be released at 10 a.m. Eastern
Time. Between Wednesday and Friday, investors will get
second-quarter gross domestic product, a Fed decision and July
payrolls among other economic items of importance. Get ready for 48
hours of economic fury
Some market apprehension for Monday could be understandable
after Wall Street's performance on Friday, which saw the Dow
industrials (DJI) drop below 17,000. The benchmark lost 123.23
points, or 0.7%, to 16,960.57, weighed down by losses in Visa Inc.
(V). For the week, the blue-chip index fell 0.8%, its biggest
weekly loss since June 14.
The S&P 500 (SPX) closed 9.6 points, or 0.5%, lower at
1,978.34 and finished the week more or less where it started, while
the Nasdaq Composite (RIXF) managed a gain of weekly 0.4%.
Fears of a bubble-bursting won't rest, said Joao Monteiro,
analyst at Valutrades. "This story may be looking a little
over-brokered, but with the quiet summer sessions lying ahead, even
just a small shock could be all it takes to precipitate a big
move," he said in a note to clients. Stock trader who called three
crashes sees 20% collapse
Goldman Sachs on Friday cut its three-month view on global
stocks to neutral over concerns a temporary bond selloff could hit
equities.
The analysts maintained an underweight on the U.S. on both a
three-and 12-month basis. "We expect reasonable returns for the
U.S. on an absolute basis over the coming year, but relative to
other markets, the longer-term recovery potential is smaller given
already high margins and strong performance so far," said the
analysts.
Mid-July, Goldman raised its year-end target for the S&P 500
index to 2,050 from 1,900, making the investment bank' one of the
most bullish on Wall Street.
Among Monday's earnings reports, Tyson Foods (TSN) is expected
to report third-quarter earnings of 78 cents a share. Coach (COH)
will also report ahead of the market open. In Europe on Friday,
LVMH Moët Hennessy Louis Vuitton shares tumbled nearly 7% after the
luxury-goods group posted a 4% fall in first-half profit, citing
negative effects from exchange rates. That news knocked Europe's
entire luxury-goods sector.
Herbalife Ltd. (HLF) will report after the close on Monday.
Herbalife, Tyson, General Growth are stocks to watch
Across other markets, Hong Kong's Hang Seng Index closed at
highs not seen in more than three years on Monday after reports
that a plan to allow direct stock trading between Hong Kong and
Shanghai could be launched mid-October. Europe stocks had trouble
making headway as U.S. stock futures leaned south.
Oil prices (CLU4) pushed lower, while gold (GCU4) was a touch
higher and the U.S. dollar index(DXY), which measures the greenback
against a basket of six other currencies, was largely steady.
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