US stock futures point to higher open after tepid Q2 GDP growth, Facebook shares dropReported by Proactive Investors on Friday, 27 July 2012 (on July 27, 2012)
|
US stock futures held onto their gains Friday morning after the release of the government's initial reading on second quarter economic growth came in slightly better than expected, while Facebook (NASDAQ:FB) shares headed for a tumble after its first earnings report as a public company did not wholly please investors.
The Commerce Department reported today that gross domestic product, the value of all goods and services produced in the U.S., rose at a slight 1.5% in the second quarter. Economists surveyed by MarketWatch had forecast the economy to expand by 1.3%.
The growth was far lower than in the last two quarters, as the U.S. grew at a revised 2.0% in the first quarter and 4.1% in the last three months of 2011.
Also due Friday is the latest reading of the University of Michigan's consumer confidence index, which is slated for 9:55am ET.
Dow futures were lately up 52 points to 12,877.00, S&P 500 futures rose 8.8 points to 1,363.60 and Nasdaq futures gained 17.5 points to 2,590.00.
Meanwhile, in Europe, gains in the morning were narrowed after a spokesman from Germany's Bundesbank told Dow Jones Newswires that the institution is still opposed to further bond purchases by the European Central Bank.
But investors found optimism after French daily Le Monde also reported the ECB and eurozone governments were preparing a plan for the central bank and the region's rescue funds to stage a joint intervention to lower borrowing costs for Spain and Italy.
Thursday, global markets were buoyed by ECB president Mario Draghi's comments at an investor conference in London, when he said he would do whatever is necessary to preserve the euro. Traders believed this was a signal for additional bond purchases to cap high borrowing costs for Spain and Italy.
In US corporate news, Facebook (NASDAQ:FB) shares slumped to new lows last night as it reported disappointing revenue growth in the first results since its high-profile IPO in May.
Shares in the social network fell US$2.50 or 8.5 per cent in deals yesterday, but tumbled a further 14 per cent before the bell, dragging the stock below US$23.
Mark Zuckerberg’s firm posted a 32 per cent increase in revenues to US$1.18 bln in the three months to June 30, but growth was the slowest seen since the first quarter of 2011.
Facebook made a net loss of US$157 mln, or 8 cents a share, in the quarter owing to tax charges after going public. Underlying profits excluding the fees rose 3.5 per cent to US$295 mln, or 12 cents per share, from US$285 mln in the second quarter last year, in line with Wall Street estimates.
There are concerns over the company’s falling advertising revenues due to increasing access via smartphones, which showed a 67 per cent rise from last year. Advertising fees from companies are smaller on smartphones as the diminutive screens make it harder to sell space.
Drug maker Merck & Co (NYSE:MRK) said Friday second-quarter net income fell 11%, with a restructuring charge masking increased revenues. Merck affirmed that in 2012 it would earn $2.04 to $2.30 a share, or an adjusted $3.75 to $3.85 per share.
Consumer goods company Newell Rubbermaid Inc. (NYSE:NWL) (NYSE:NWL) said second-quarter profit fell 24% on a higher tax expense and lower sales, but adjusted earnings topped analyst forecasts.
Shares of Starbucks Corp. (NASDAQ:SBUX) dropped nearly 10% in premarket action as the coffee-bar chain reported record third-quarter results after the bell yesterday, but warned that weak consumer spending in Europe and rising commodity costs will impacts its fourth quarter results as well as those next year.
Amazon.com (NASDAQ:AMZN), meanwhile, reported on Thursday a fiscal second-quarter profit of $7 million, or a penny a share, on revenue of $12.83 billion. This compared with $191 million, or 41 cents a share on $9.9 billion in sales a year ago. Analysts surveyed by FactSet Research had forecast the online retailer to earn a penny a share on $12.9 billion in sales for the quarter ended June 30.
The company also said it expects to see an operating loss in its current quarter. Shares were up 1.5% before the bell.
*Commodities *
Crude oil for September delivery rose 50 cents to $89.89 a barrel, while gold for August rose $12.3 to $1,627.40 an ounce.
*Europe*
European markets are broadly higher today with shares in France leading the region. The CAC 40 was lately up 1.20% while Germany's DAX rose 0.26% and Britain's FTSE 100 gained 0.09%.
Links:  Full news story
|
|
|
| Recent related news |
| |
Proactive Investors
1 day ago | *¤ YESTERDAY IN GOLD & SILVER*
After an exciting day on Monday, trading in the Far East was very... |
Proactive Investors
1 day ago | Canadian shares stretched this year's gains on Wednesday, fueled by gains across most major sectors... |
DailyFinance
2 days ago | Filed under: Investing
LONDON -- Stock index futures at 7:30 a.m. EDT indicate that the *Dow Jones... |
guardian.co.uk
2 days ago | Dimon won his battle with shareholders and remains CEO and chairman, but his ego is masking problems... |
Zero Hedge
3 days ago | Another event-free day in which the only major economic data point was the release of UK CPI, which... |
| |
Business Insider
4 days ago | The six best math students at the all-boys Browning School on Manhattan's East Side were given bad... |
DailyFinance
4 days ago | Filed under: Investing
LONDON -- Stock index futures at 7 a.m. EDT indicate that the *Dow Jones... |
Zero Hedge
4 days ago | · Obama's Counsel Was Told of IRS Audit Findings Weeks Ago (WSJ)
· North Korea fires sixth missile... |
Zero Hedge
5 days ago | Submitted by Pater Tenebrarum of Acting-Man blog,
-*Full Court Press*-
Not a day passes without... |
DailyFinance
1 week ago | Filed under: Investing
No other metal is quite like gold. Physically, its malleable, it does not... |
| |
|
|
Facebook
E-mail
Twitter
Mixx
StumbleUpon
FriendFeed