yup: Walmart miss not helping either: U.S. Stock-Index Futures Extend Losses on Surprise Gain in Jobless Claims
By Elizabeth Stanton and Adria Cimino
Feb. 18 (Bloomberg) -- U.S. stock-index futures extended declines after first-time claims for unemployment benefits unexpectedly increased last week, spurring concern job losses will stifle the economic recovery.
Wal-Mart Stores Inc. fell 1.6 percent after the world’s largest retailer reported comparable-store sales that trailed its forecast. Bank of America Corp. and Home Depot Inc. slipped after the government said initial jobless applications rose by 31,000 to 473,000. Hewlett-Packard Co. rose after increasing its full-year earnings forecast.
Standard & Poor’s 500 Index futures expiring in March retreated 0.5 percent to 1,093.8 at 8:49 a.m. in New York. Dow Jones Industrial Average futures dropped 0.4 percent to 10,250 and Nasdaq-100 Index futures decreased 0.3 percent to 1,805.5.
U.S. stocks advanced yesterday, a day after the biggest rally since November for the S&P 500 Index, as better-than- estimated earnings, industrial production and housing data bolstered confidence in the economic recovery.
The S&P 500 has fallen 4.4 percent from a 15-month high on Jan. 19 as widening fiscal gaps in Greece, Portugal and Spain spurred concern Europe faces another recession. The index is still up 63 percent from a 12-year low in March.
The dollar advanced against 14 of the 16 major currencies, reducing the value of companies’ sales made abroad.
‘Brake’ for Stocks
“The more the dollar rises, the more it’s a brake for the U.S. stock market,” said Jacques Porta, a fund manager at Ofi Patrimoine in Paris, which oversees about $425 million in equities. In earnings reports, “outlooks are in line, but the market is hungry and wants better news. Investors want more than in line. That’s why the market has been volatile.”
Wal-Mart fell 1.6 percent to $53.20 in trading before the open of U.S. exchanges. Sales by U.S. stores open at least a year fell 1.6 percent, topping the company’s projection of a decline of no more than 1 percent. Fourth-quarter profit was $1.17 a share, beating analysts’ estimates of $1.12, Wal-Mart said. Revenue was $113.65 billion, less than analysts’ estimates of $114.46 billion.
Hewlett-Packard gained 0.4 percent to $50.30. The personal- computer maker increased its full-year earnings forecast after first-quarter profit topped analysts’ estimates.
Earnings Watch
A record nine-quarter earnings slump is projected by analysts to have ended in the fourth quarter with an 80 percent increase in S&P 500 profits. Forty-five companies in the index are scheduled to release results this week. More than 350 companies in the S&P 500 have reported fourth-quarter earnings since Jan. 11, and about 76 percent have beaten analysts’ estimates on a per-share basis, according to data compiled by Bloomberg.
Dell Inc., the world’s third-largest maker of personal computers, is scheduled to report fourth-quarter earnings after the stock market closes. The shares rose 0.9 percent to $14.23.
The index of U.S. leading indicators probably rose in January for a 10th straight month, pointing to an economy that will keep expanding through the first half of this year, economists said before a report set for 10 a.m. New York time.
The Conference Board’s gauge of the outlook for the next three to six months rose 0.5 percent after climbing 1.1 percent in December, according to the median forecast of 53 economists surveyed by Bloomberg News.
To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net; Adria Cimino in Paris at acimino1@bloomberg.net.
Last Updated: February 18, 2010 08:54 EST
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