Published November 15, 2012
FOX Business: Capitalism Lives Here
Dow futures pointed to more losses for the blue-chip average on considerably weaker-than-expected weekly jobless claims data and mixed results from retail giant Wal-Mart.
As of 8:45 a.m. ET, Dow Jones Industrial Average futures fell 39 points to 12505, S&P 500 futures dipped 2.3 points to 1351 and Nasdaq 100 futures climbed 0.25 point to 2530.
The markets took a pounding on Wednesday, knocking the Dow and the Nasdaq back to June levels. The Nasdaq now sits in correction territory. Meanwhile, the broader S&P 500 is trading at its lowest level since July and is within 37 points of a correction.
Worries about the fiscal cliff and mounting tensions in the Middle East dominated the headlines yesterday. Both of those topics still commanded a strong focus across trading desks today, but a round of fresh data on the world's biggest economies and corporate earnings reports may also help define Wall Street's trajectory.
New claims for unemployment benefits rose last week to 439,000 -- the highest level since April 2011 -- from an upwardly revised 361,000 the week prior. Claims were expected to rise to 375,000 from an initially reported 355,000. The Labor Department said Hurricane Sandy likely distorted the claims number, but the level of the distortion was not immediately clear.
Prices at the retail level climbed 0.1% in October from September, matching expectations. Excluding the food and energy components, prices were up 0.2%, a slightly bigger gain the 0.1% economists expected.
The New York Federal Reserve's regional manufacturing gauge rose to -5.22 in November from -6.16 in October, coming in better than expectations of a -6.7 reading. Readings above zero point to expansion, while those below indicate contraction.
A report later from the Philadelphia Federal Reserve is anticipated to show the manufacturing sector in the mid-Atlantic region expanding at a slower pace in November than the month before.
On the global front, the eurozone's economy contracted at a quarter-to-quarter rate of 0.1% in the third quarter, the second-straight contraction. That means the 17-member currency bloc is now in its second recession since 2009 as the three-year-old debt crisis weighs heavily on output. The bloc's two biggest economies, Germany and France, managed to post tepid expansions.
Tensions between Israel and Palestine continued ratcheting up. On Wednesday Israel began a campaign of rocket attacks into Palestine as retribution for rocket attacks into Israel. One of the attacks killed a top Hamas military commander, and others were aimed at Hamas military installations. Hamas has pledged retaliation, and other regional and world powers have been forced to make statements, causing concerns about the potential for another war in the Middle East.
Energy futures were in the green after a strong showing on Wednesday. The benchmark crude oil contract advanced 19 cents, or 0.22%, to $86.51 a barrel. Wholesale New York Harbor gasoline climbed 0.75% to $2.670 a gallon. Gold dropped $12.20, or 0.71%, to $1,718 a troy ounce.
In corporate news, Wal-Mart (WMT) posted a third-quarter profit of $1.08 a share, topping expectations by a penny. Revenues of $113.2 billion came in short of Wall Street’s forecast of $114.96 billion. The world’s largest retailer also tightened its full-year profit guidance to a range of $4.88 to $4.93 a share.
The Euro Stoxx 50 dipped 0.58% to 2458, the English FTSE 100 slumped 0.6% to 5688 and the German DAX sold off by 1% to 7033.
In Asia, the Japanese Nikkei 225 rallied 1.9% to 8830 and the Chinese Hang Seng tumbled 1.6% to 21109.