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Stocks set to slide at opening

Stocks set to slide at opening

Stocks are set to slide Wednesday as investors remain cautious about the size of a potential economic recovery. Futures are lower.
Overseas markets are falling, following weakness in the U.S. on Tuesday after a disappointing report on consumer confidence in the world's largest economy.
Investors will turn their attention to reports on durable goods and new home sales hoping for a spark that has been absent from the market so far this week.
Orders to factories for items that are expected to last at least three years, like autos, computers and aircraft, likely grew in September. A rise in durable goods orders would provide further evidence of the beginnings of a rebound in the manufacturing sector.
Economists polled by Thomson Reuters expect orders increased 1 percent in September, after a 2.6 percent decline in August.
The report from the Commerce Department is due out at 8:30 a.m. EDT.
The Commerce Department is also scheduled to release data on new home sales at 10:00 a.m. EDT. The report is expected to show sales jumped in September for the sixth straight month.
While another increase would be a welcome sign, housing sales are getting a boost from a tax credit for first-time buyers that expires at the end of November, so any increase could be tempered knowing sales could slowdown after that incentive expires.
Economists predict sales increased 2.6 percent to a seasonally adjusted annual rate of 440,000.
Ahead of the opening bell, Dow Jones industrial average futures fell 57, or 0.6 percent, to 9.778. Standard & Poor's 500 index futures declined 6.60, or 0.6 percent, to 1,053.80, while Nasdaq 100 index futures fell 7.50, or 0.4 percent, to 1,712.25.
In another sign the financial sector still might not be fully recovered, GMAC Financial Services is in talks with the Treasury Department for a third bailout. The auto and mortgage lender has been among the hardest hit financial firms by rising loan defaults and faulty credit markets.
The government already holds a 35 percent stake in GMAC after giving it with $12.5 billion in bailout money.
Economic data in recent days has been mixed, giving investors a reason to pause. It has also allowed traders to take some profits after a relentless run-up in stocks since March.
Stocks mostly struggled again on Tuesday after a disappointing report on consumer confidence. The Conference Board said its consumer confidence index fell unexpectedly to 47.7 in October. Analysts predicted the reading would remain flat at 53.1.
The index declined to its second-lowest level since May.
Weak consumer strength is disconcerting heading into the holiday shopping season. Consumer spending accounts for more than two-thirds of economic activity and while corporate profits have been improving, investors are still waiting for a rebound in sales and revenue.
The Dow was able to edge out a small gain because of strength at IBM Corp. and rising energy stocks. However, the S&P and Nasdaq both declined Tuesday. The Dow rose 0.1 percent, while the S&P was off 0.3 percent and the Nasdaq tumbled 1.2 percent.
Stocks have mostly been declining in recent days, after hitting yearly highs early last week. A strengthening dollar and declining commodities prices have weighed on stocks.
The dollar mostly rose against other major currencies early Wednesday, while gold prices rose.
Meanwhile, bond prices mostly rose. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.44 percent from 3.45 percent late Tuesday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.08 percent from 0.06 percent.


Updated : 2021-05-12 22:06 GMT+08:00