09:45AM Wall Street opened lower on profit-taking and TI trimmed sales forecast.
Wall Street opened in the negative Wednesday, retreating from notable gains posted yesterday as investors turned to profit taking. With little news to affect the broad market, the focus remained on what the Federal Reserve’s move will be at the central bank policy meeting on Sept. 18. What is widely expected is a reduction of the federal funds rate by 0.25%, although a slumping dollar may prevent the Fed from making such a decision.
Weakness in the shares of Texas Instruments (
TXN: chart) also weighed on the sentiment. The chipmaker fell 2.4% after it cut its sales forecast for Q3. At the same time, Amgen (
AMGN: chart) led the biotech sector up with a gain of 3% after UBS raised its rating on the biotechnology company to neutral from sell.
Among companies driven by analyst comments, Apache Corp. (
APA: chart) climbed 1.6% after Goldman Sachs upgraded the oil and gas producer to buy from neutral. Chip-equipment maker ASML Holdings (
ASML: chart) gained 0.3%, following an upgrade to outperform from underperform by Credit Suisse.
In earnings-related news, Pathmark Stores (
PTMK: chart) edged down 0.3% after it reported wider Q2 net loss widened. Shares of Dow component Exxon Mobil (
XOM: chart) gained 0.3% as oil prices reached $78.20 a barrel. The dollar was also weaker vs. the euro and the yen, but higher versus the pound. Gold prices rose.
The Dow Jones industrial average fell 39.01, or 0.29%, to 13,269.38 after rising 180 points on Tuesday. The Standard & Poor's 500 index futures fell 5.30, or 0.36%, to 1,466.19, while the Nasdaq composite index fell 6.85, or 0.26%, to 2,590.62.
09:00AM U.S. stock futures pointed lower after yesterday’s rally and weak dollar.
U.S. stock futures indicated a weaker start of Wednesday trading session, reversing from solid gains Tuesday on optimism of interest-rate reduction in the near term, as well as upbeat corporate news from auto maker General Motors (
GM: chart) and fast-food retailer McDonald''s Corp (
MCD: chart). Record-low levels of the U.S. dollar exerted further pressure on pre-market sentiment. The greenback traded down 0.4% at 113.85 yen, while the euro traded as high as $1.3880.
Texas Instruments (
TXN: chart) also weighed with a decline of 2.2%. The chipmaker lifted its Q3 earnings and revenue forecast, meeting the average analyst expectations. Bucking the downward trend, Amgen (
AMGN: chart)rose 2.3% in pre-open trade after UBS raised its rating on the biotechnology company to neutral from sell. In other corporate news, Google (
GOOG: chart) said its executive in charge of health-related projects, Adam Bosworth, has resigned. The stock edged down 0.3%.
A day after crude oil hit a record of $78.23 a barrel, the market will keep the commodity in focus. U.S. oil inventories report is due out today and is expected to show a decline in crude supplies last week. S&P 500 futures slipped 6.5 points at 1,466.30 and Nasdaq 100 futures were down 9 points at 1,984.50. Dow industrial futures declined 39 points.
8:30AM New York - 6:30PM Mumbai – Sebi widens the acceptable to collateral to include highly rated debt securities. Steel Authority plans to double its steel capacity in four years. The Supreme Court of India permits Reliance Energy to bid for Mumbai Sea Link project.
Sensex in Mumbai trading lost 37.41 or 0.24% to close at 15,608.50. CNX Nifty fell 0.8 or 0.02% to close at 4,496.15. Rupee recovered to 40.60 against dollar from 40.65 in Friday trading. Market indexes opened higher at the opening but closed lower in a familiar pattern in the last three months of trading. Political worries dogged traders.
The talks between the ruling coalition government and working committee of left parties agreed to create a framework for negotiations of increasingly controversial nuclear deal between the U.S. and India. External Affairs Minister Pranab Mukherjee is expected to lead the discussion after Sept 19th.
Of the stocks trading on BSE, 1,610 gained, 1,157 declined, and 55 closed unchanged. Daily turnover on the exchange declined to 5,362 crore rupees compared to 4,839 crore rupees in Tuesday’s trading. In trading on National Stock Exchange volume declined to 10,835 crore rupees from 10,856 crore rupees a day ago. Oil price at record level lifted stocks of sugar companies.
Of the 30 stocks in the Sensex, 23 fell and 10 gained. Reliance Energy led the gainers in the index with a rise of 3.6% to 891 rupees. NTPC led the decliners in the index with a loss of 3.1% to 189 rupees.
Securities and Exchange Board of India permitted as collateral securities rated AAA from foreign investors for derivative positions and trading. The move by Sebi is likely to boost foreign investment.
Reliance Energy jumped after the news that Supreme Court of India has permitted the company to bid for 2,600 crore rupees Mumbai Sea Link project.
Steel Authority of India jumped 1.8% to 174 rupees after the company released plan to expand its current capacity to 26 million tons from 13.5 million tons by the year 2010. The company plans to invest 40,000 crore rupees.
