JNJ UP and RAH down
U.S. stock-index futures were little changed as Moody’s Investors Service downgraded Spain and Cyprus and as investors awaited reports on U.S. consumer prices and jobless claims.
Johnson & Johnson (JNJ), the world’s biggest health-care products company, advanced in German trading. Ralcorp Holdings Inc. (RAH) fell 2.5 percent after saying it will restate three years of financial results.
Standard & Poor’s 500 Index futures expiring in September fell 0.1 percent to 1,307.6 at 10:51 a.m. in London. The S&P 500 Index fell yesterday as borrowing costs rose in Italy and Germany before elections in Greece amid concern that the Mediterranean nation will leave the euro area. Dow Jones Industrial Average futures lost 0.1 percent to 12,418 today.
“We’re in a waiting phase ahead of the Greek election,” said Bernard Delattre, president of Altimeo Asset Management in Paris. “If Greece stays in the euro zone, we’re expecting a strong rebound next week. What happens in Europe is now a main concern for the U.S.”
Greeks head to the polls on June 17 after an inconclusive May 6 election that catapulted into second place a party opposed to budget-austerity accords tied to 240 billion euros ($301 billion) in international aid pledges received since May 2010.
Ratings Cut
Moody’s Investors Service yesterday cut Spain’s rating by three steps to Baa3 from A3, citing the nation’s increased debt burden, weakening economy and limited access to capital markets. Moody’s also lowered Cyprus’s bond rating to Ba3 from Ba1.
The U.S. consumer-price index decreased 0.2 percent in May after no change in April, according to the median forecast of 78 economists surveyed by Bloomberg News. The so-called core measure, which excludes volatile food and fuel costs, may have climbed 0.2 percent for a third month.
First-time applications for unemployment benefits dropped by 2,000 to 375,000 last week, according to the median projection in a Bloomberg survey before the Labor Department’s data due at 8:30 a.m. Washington time.
Rising truck shipments show the U.S. economic expansion is intact, even amid concerns that a slowdown in retail sales and Europe’s sovereign-debt crisis could stall growth. Two measures of trucking activity signal the industry remains steady and has even “firmed up” since mid-May, according to Ben Hartford, an analyst in Milwaukee with Robert W. Baird & Co.
J&J added 0.7 percent to $64.87. The stock rose 2.2 percent yesterday after saying its $19.7 billion purchase of Synthes Inc., the largest acquisition in the company’s 126-year history, will add 3 cents to 5 cents a share to 2012 earnings as it gained U.S. clearance for the deal.
Ralcorp, a producer of store-brand foods, slipped 2.5 percent to $62.42 in German trading. The company said additional errors in certain financial statements were found and it concluded that internal controls were ineffective. Ralcorp said it is restating results for three years.
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