Ieva M. Augstums
Stock futures point to lower Wall Street opening
The stock market headed toward a modestly lower start Wednesday as investors wait for aluminum maker Alcoa Inc. to give some guidance about the economy.
U.S. stock futures fell slightly while markets around the world were little changed. The falling price of oil, which stock investors are interpreting as a sign of economic weakness, has contributed to selling on world exchanges over the past week.
The decline in futures means Wall Street might extend Tuesday’s sharp drop, but there’s likely to be little conviction in the selling. Investors want to see what Alcoa has to say about the economy in its earnings report, which comes out after the market’s close.
Wall Street analysts expect Alcoa to post a second-quarter loss of 38 cents per share. In the same period a year earlier, Alcoa earned 66 cents per share on revenue of $7.6 billion.
Dow Jones industrial average futures are down 16, or 0.2 percent, at 8,115, while the broader Standard & Poor’s 500 index futures are down 1.80, or 0.2 percent, at 887.50. Nasdaq 100 index futures are down 1.25, or 0.1 percent, at 1,406.75.
Investor confidence has waned after poor U.S. and European jobs data and plunging commodities prices.
Oil prices have declined to below $62 a barrel from $73 last week as investors believed that demand for energy would fall because of the weak economy. A barrel of crude traded at $61.84, down $1.09, in electronic trading ahead of the opening on the New York Mercantile Exchange.
Overseas Wednesday, Japan’s Nikkei stock average fell 2.4 percent. In afternoon trading, Britain’s FTSE 100 index slipped 0.3 percent and Germany’s DAX fell 0.2 percent while France’s CAC-40 was off 0.6 percent.
World leaders including President Barack Obama will be discussing the global economy as they start a three-day meeting in Italy.
Investors will also be looking to glean what they can from a key report on May consumer credit data, due out at 3 p.m. EDT.
The Federal Reserve report is expected to show that consumer credit fell $9.5 billion from April, according to Wall Street economists surveyed by Thomson Reuters. If they are right, it would mark the latest move by consumers to curb their borrowing, pay down debt and get their household budgets in better shape. That is a concern for investors because it means consumers aren’t spending at the levels needed for an economic recovery.
Meanwhile, bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.44 percent from 3.46 percent late Tuesday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.18 percent from 0.17 percent late Tuesday.
The dollar mostly rose against other major currencies, while gold prices fell.
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