European Futures called to open flat this morning.
U.S. stocks cut some losses late Monday afternoon, but still finished the session sharply lower after Standard and Poor’ cut its long-term outlook on U.S. debt to negative. “I would say investors have been anticipating this somewhat, but when the shoe falls, it sends a vibration throughout the market,” said Ron Kiddoo, chief investment officer at Cozad Asset Management. he Dow Jones industrial average (INDU) sank 140 points, or 1.1%. The S&P 500 (SPX) fell 15 points, or 1.1%, and the Nasdaq Composite (COMP) lost 29 points, or 1.1%. Earlier in the session, all three indexes were down 2%. S&P kept its “AAA’”-rating on the world’ largest economy, but said it was concerned about the United States’ ballooning deficit. While President Obama and GOP leaders have unveiled separate plans to reduce the U.S. deficit, the ratings agency said “the gap between the parties remains too wide.” The news sent stocks plunging right from the open, with 92% of the S&P 500 companies finishing the day in the red, and all but one of the Dow’ 30 components trading lower. Bank of America (BAC, Fortune 500), Caterpillar (CAT, Fortune 500) and Alcoa (AA, Fortune 500) were the biggest drags on the blue chip index.
Asian stocks fell, sending the region’s benchmark index to its biggest loss in five weeks, while South Korea’s won and the New Zealand dollar led a drop in higher-yielding currencies after Standard & Poor’s cut its credit outlook on the U.S. to negative.
Events this Week
Tuesday — Before the open, Wall Street giant Goldman Sachs will report its results. Analysts expect to see Goldman’ profits fall to 82 cents a share compared with the $5.59 it reported a year ago.
After the bell, technology giants Intel and IBM will report their results. Analysts are looking for Intel to earn 46 cents a share, while IBM is expected to post a profit of $2.30 a share.
Also reporting after the bell is Internet search portal company Yahoo! (YHOO, Fortune 500).
Along with earnings, the Commerce Department will release March housing starts and building permits data at 8:30 a.m. ET.
Wednesday — Technology investors will be eagerly awaiting results from Apple, which reports after Wednesday’ closing bell. Apple earnings are expected to jump to $5.35 a share, bolstered by sales of the Verizon iPhone and the iPad.
Other names to report on Wednesday include Dow components AT&T (T, Fortune 500), Travelers (TRV, Fortune 500) and United Technology (UTX, Fortune 500), metal and mining giant Freeport McMoRan (FCX, Fortune 500), chipmaker Qualcomm (QCOM, Fortune 500) and Wells Fargo.
On economic data, Wall Street will get existing home sales from the National Association of Realtors at 8:30 a.m. ET. Economists are looking for existing home sales to rise 5 million annualized units, according to Briefing.com
Thursday — The biggest name to report will be industrial conglomerate General Electric (GE, Fortune 500), which has been under pressure this past quarter due to the Japanese earthquake and subsequent nuclear disaster. Analysts expect GE to report earnings of 28 cents a share.
Investors will also get earnings from asset managerBlackRock (BLK, Fortune 500), fast food giant McDonald’ (MCD, Fortune 500), investment bank Morgan Stanley (MS, Fortune 500) and chemical company DuPont (DD, Fortune 500) among others.
For economic data, the Labor Department will release weekly jobless claims figures at 8:30 a.m. ET, with the Philadelphia Federal Reserve releasing its April activity index at 10 a.m. ET. Economists expect weekly claims to fall to 390,000 from last week’ 412,000 claims while the Philly Fed survey is expected to drop to 32.9 from last month’ 43.4.
Friday — U.S. markets are closed. No major companies will report earnings and no economic data will be released.