09:00AM U.S. stock futures indicated a steeply lower start, opressured by continuous credit worries.

U.S. stock futures predicted another day of heavy losses Friday, extending the steep decline from the previous session amid constantly growing credit market worries. On Friday, market received a fresh injection of cash by overseas central banks. The ECB injected 61 billion euros in a tender auction, and the central banks of Japan and Australia poured in roughly $12.5 billion.

According to Citigroup, investors using quantitative strategies, or computer models are experiencing a lot of difficulties. Countrywide Financial (CFC) fell 15% in pre-open after the U.S. mortgage lender said future profits may be hurt by the severe credit market disruptions.

In earnings-related news, California Pizza Kitchen (CPKI) dropped 12% as the company's yearly earnings forecast came at the low end of analyst expectations. Graphics chip provider Nvidia (NVDA) fell more than 8% after it announced a 3-for-2 stock split. The company posted stronger-than-forecast quarterly earnings.

The concerns about credit and the effect of bad subprime loans sent global markets sharply lower. Japan's Nikkei fell 2.4%, Hong Kong's Hang Seng Index fell 2.9%. In early afternoon trading, Britain slipped 2.98%, Germany fell 1.59%, and France's CAC-40 dropped 3%.

S&P 500 futures, in volatile moves throughout the morning, dropped 19.3 points at 1,438.60 and Nasdaq 100 futures dropped 21.5 points at 1,924.00. Dow industrial futures dropped 190 points. The yield on the benchmark 10-year Treasury note fell to 4.74% from 4.79%late Thursday.


8:30AM New York, 8:30 PM Hong Kong – Asian markets corrected sharply on weakness in European and New York markets.

Asian markets closed declined with heavy losses in Korea, Hong Kong, and Australia tracking lower markets in New York and Europe. Korea led the decliners in the region with a loss of 4.2% followed by 3.6% fall in Australia, 3% decrease in Philippines and Hong Kong, 2.7% fall in Taiwan, and 1.5% decline in India, Indonesia, and Singapore.

In Hong Kong trading stocks fell sharply largely on the market nervousness than on fundamentals. Daily turnover on the main board dropped to HK$65.5 billion from HK$ 85.2 billion and volume on GEM market was reported at HK$0.5 billion, a decline of 50% from the previous session. Hang Seng Index opened sharply lower and attempted several rebounds in the morning trading but failed to gain much ground. Banks led the decliners. HSBC dropped 2% and Bank of East Asia fell 3%.

China reported July trade surplus of $24.4 billion, 67% jump from a year ago, and declined from $26.9 billion from June. The elevated surplus is fueling sharp rise in bank deposits, real estate prices, and stock market valuations. The rising demand is also fueling inflation in energy and food prices above the target set by the central bank. The People’s Bank of China said that the broadest measure of money supply, M2, rose 18% in July. Outstanding local currency loans in the month surged 16.6% and deposits in the local currency increased 16%.

Shanghai Composite Index edged fractionally lower to close at 4,749.37, still near the record high.

In Sydney trading ASX 200 fell 222.50 or 3.6% to 5,965.20. Of the total 201 stocks in the index, 9 gained, 189 declined, and 3 remained unchanged.

Perilya Ltd led the stocks in the index with a fall of 13.6% followed by 10% loss in Compass Resources, Mincor Resource, and Monadelphous Group. PMP Ltd led the gainers in the index with a rise of 2.6% followed by 2.11% gain in Futuris Corp, 1.7% increase in City Pacific, and 1% rise in Boom Logistics.

The Reserve Bank of Australia added liquidity in the market to stem the rising interest rates and worries that credit crunch may stem economic growth. The global injection of liquidity in local markets was carried out by the Federal Reserve Bank in Washington, the European Central Bank in Europe, and Central Bank in Japan.


8:00AM Nvidia said its Q2 profit doubled.

Nvidia Corp. (NVDA), graphics chip maker, said late Thursday its Q2 profit nearly doubled, boosted by increased use of graphics-intensive applications. Quarterly net income rose to $172.7 million, or 43 cents per share, up from $86.8 million, or 22 cents per share a year ago. Company’s revenue jumped 36% to $935.3 million. Analysts had expected earnings of 43 cents per share on $859.9 million in revenue. Shares of Nvidia dropped 6.7% in pre-market trading.


7:00AM New York, 8:00PM Tokyo – Market indexes in Tokyo more than 2% as fears arising from credit worries in the U.S. spread to the Asian markets.

Nikkei 225 index plunged 406.51 or 2.37% to 16,764.09 at close with financial and brokerage stocks leading the decliners. Topix index dropped 2.96% to close at 1,633.93. Market turnover has reached peak level and today was no different. Daily turnover fell from 5.3 trillion yen to 4.5 trillion yen but still hovered at triple the daily average volume.