Nasdaq set to drop after Apple profit miss
By Edward Krudy
Apple Inc's <AAPL.O> results fell short of estimates for the first time in years as it sold far fewer iPhones than expected. Shares fell 4.7 percent to $402.25 in premarket trading.
Stocks surged in late trading on Tuesday after Britain's Guardian newspaper reported France and Germany reached a deal to pump up the euro zone's rescue fund to more than 2 trillion euros. Two senior European Union officials dismissed the report.
The S&P 500 index has struggled to make progress as it approaches the top end of a two-month trading range at around 1,250.
Wayne Kaufman, chief market analyst at John Thomas Financial in New York, said the recent run-up in the market would likely mean that gains would be kept in check for now.
"The wide swinging day we had yesterday might cap the market for a little while," he said. "People are nervous about earnings in general regardless of Apple ... it's a mixed bag right now."
S&P 500 futures fell 1.3 points but 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 4 points, and Nasdaq 100 futures were off 15 points.
Helping futures pare early losses, housing starts surged in September at their fastest annual pace in 17 months, the government reported.
"Europe is still the biggest story in this market and the rumors yesterday of a large cash infusion are positive to the market on so many levels," said Rick Meckler, president of investment firm LibertyView Capital Management in New York.
Tens of thousands of striking Greeks rallied outside parliament in one of the biggest protests since the crisis broke out nearly two years ago, as lawmakers debated a new wave of public sector pay cuts and layoffs demanded by lenders in exchange for more bailout funds.
Morgan Stanley <MS.N> swung to a $2.15 billion profit in the third quarter, reversing a year-earlier loss, helped by a large accounting gain, it said early Wednesday. The shares rose 1.6 percent to $16.90, but premarket trading was volatile.
(Editing by Jeffrey Benkoe)