Published October 17, 2012
NEW YORK – Stock index futures were close to flat on Wednesday as investors awaited quarterly results from Bank of America Corp , which could provide more insight into the state of the banking sector.
Tech shares will likely be pressured a day after both Intel Corp and IBM reporting disappointing quarterly results.
Results for financial companies have been mixed so far this earnings season, with Citigroup and Goldman Sachs posting strong results that pointed to improved trends in the group, though JPMorgan Chase and Wells Fargo disappointed.
Equities may be due for a pullback as they're coming off their best two-day advance in a month, a rise of 1.8 percent. Those gains came as some disappointments early in the earnings season were offset by strong results from such bellwethers as Johnson & Johnson .
Still, the first major reads on the tech sector suggested there were still reasons for caution. Late Tuesday, Intel gave a weak fourth-quarter revenue outlook while IBM posted third-quarter revenue that came in under expectations.
The tech sector is closely monitored as it is viewed as a proxy for business spending.
On Wednesday, Intel shares fell 2.5 percent to $21.79 in premarket while IBM lost 3.3 percent to $204. Both firms are Dow components.
S&P 500 futures rose 1.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures fell 1 point and Nasdaq 100 futures fell 0.5 point.
Earnings for S&P 500 components are expected to decline 2.3 percent from a year ago, but the forecast does mark a slight improvement from estimates last week, according to Thomson Reuters data.
Concerns have been high going into the season as a rash of corporate warnings heading into the period raised worries that slower growth in Europe and China may be affecting corporate America more than previously thought.
American Express Co , PepsiCo and US Bancorp are all also on tap to report Wednesday.
Outside of earnings news, ASML agreed to buy Cymer , its key supplier of a light-based technology crucial to making a new generation of much smaller chips, for $2.5 billion.
While earnings have been the primary driver for shares, Europe's debt crisis continues to remain in focus as well. Shares in Europe <.FTEU3> rose 0.3 percent on relief that Spain had clung on to its investment-grade rating.
Stocks closed 1 percent higher on Tuesday, lifted by strong results from J&J and Goldman.
(Editing by W Simon)