Stock futures soften after durable goods report

The figure declines when excluding the transportation component. Investors stay cautious ahead of the Greek Prime Minister and German Chancellor’s discussions. Samaras will meet the French President on Saturday.

By TheStreet Staff Aug 24, 2012 9:10AM
Updated at 9:10 a.m. ET


By Andrea Tse


Stock futures took a mild hit Friday after the Census Bureau’s report of a decrease in durable goods orders excluding the transportation component added to investors’ caution amid meetings of several  European leaders this week.

 

Futures for the Dow Jones Industrial Average ($INDU) were down by 7 points at 13,032. S&P 500 ($INX) futures were down by 1.79 points at 1,398. Futures for the Nasdaq ($COMPX) 100 were falling by 1.5  points to 2,759.

 

The Census Bureau said that durable goods orders rose 4.2% in July, the third consecutive monthly increase. But excluding transportation, new orders decreased 0.4%. Economists on average thought that durable goods in July would increase 2.4% and that the core figure would rise 0.5%.

 

“The bottom line is that the headline gain is all transport/aircraft driven, but [the] details are miserable,” said David Ader, a strategist at CRT Capital Group.

 

Overseas, Greek Prime Minister Antonis Samaras was meeting with German Chancellor Angela Merkel in Berlin Friday, and was expected to meet with French President Francois Hollande in Paris Saturday, as Athens sought an extension of its bailout terms.

 

Meanwhile, in the days ahead of the meetings, Eurozone leaders have asserted that the decision on providing fresh aid to Greece won't take place until international lenders have completed their review of the country's progress in reaching financial targets.

 

"The Greek PM and the German Chancellor meet to swap holiday photos," commented Paul Donovan, global economist at UBS. "After her cozy chat with French President Hollande yesterday, Merkel reiterated the importance of the Troika report on Greece. This seems to be becoming a fig leaf to cover up any embarrassment over changing the bailout duration."

 

The FTSE in London was off 0.09% and the DAX in Germany was lower by 0.20%.

 

The Hong Kong Hang Seng index closed off by 1.25% and the Nikkei in Japan finished behind by 1.17%.

 

Stocks fell Thursday after a Federal Reserve official cast doubt on the possibility of further central bank accommodation, while a jobs report showed unexpected deterioration.

 

Federal Reserve Bank of St. Louis President James Bullard said during an interview with CNBC that the Federal Open Market Committee minutes released Wednesday were "a bit stale ... we have some data since then that is stronger."

 

October crude oil futures were down 42 cents at $95.85 a barrel and December gold futures were shedding $3.20 at $1,669.60 an ounce.

 

The benchmark 10-year Treasury was up 6/32, diluting the yield to 1.657%. The greenback up 0.21%, according to the dollar index.

 

In corporate news, Autodesk (ADSK), the San Rafael, Calif.-based design-software maker, reported disappointing quarterly results for the first time in almost two years. The company plans to reduce its headcount as global economic uncertainties weigh on its business.

 

Citigroup upgraded Federated Investors (FII) to buy following news on Thursday that the Securities and Exchange Commission doesn't plan to move forward with plans for increased regulation with regard to money markets.

 

A unit of QEP Resources (QEP), the Denver, Colorado-based oil and natural gas exploration company, has reached an agreement to purchase crude oil properties in North Dakota from a number of sellers for roughly $1.38 billion in cash in order to expand its presence in the Williston Basin.

 

Salesforce.com (CRM), the San Francisco-based enterprise cloud computing company, provide disappointing third-quarter earnings guidance.


 

More from TheStreet.com


9Comments
Aug 24, 2012 9:57AM
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A few more years of Owebama and Helicopter Ben, and you may want Dracmas over Dollars!   They probably will be worth more!
Aug 24, 2012 4:26PM
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We were able to hold on nicely...After yesterday, not a reason to get too excited...Manipulators with a chip on their shoulders once again...Oh well, tough...Lets just be glad the market is not a mirror of the economy, we would all be in a world of hurt....Next week wont be an easy one, better believe that....Have a great weekend all.
Aug 24, 2012 3:59PM
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Never recovered back for the week....But gave it the old College try...

Loss a little value in the totals too...

Aug 24, 2012 2:53PM
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A bit over an hour to go and we are still hanging in there...Do not take these scumbags for granted though, an hour is an eternity and things can change in a NY minute; like we said earlier, volume is low, not a good sign if manipulators start doing their thing...More after the close
Aug 24, 2012 11:47AM
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We opened the day lower, all of a sudden there is a turn around, beware, could just be a sucker's rally; low volume and plenty of manipulators so, just a warning, be careful...More a bit later...Scumbags had a very good day yesterday and believe us, they want to repeat, especially on a friday.
Aug 24, 2012 7:34PM
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Message to the EU.  Time to depart from your former prejudices regarding the Muslims in Turkey, and let them join the EU.  Their economic strengths would compensate for the loss of Greece and perhaps boost that  portion of Italy being enervated by the debt situation.  The Turks are also geo-politically stable (for a Muslim dominated state) and a powerful import-export hub between Europe and Asia..... Just a thought.   
Aug 24, 2012 10:54AM
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Yeah and Like me, You are into the PGM gig, waiting for a stronger QE3....

C'mon guy let's be honest with ourselves and 'fess up a little....

Aug 24, 2012 9:30AM
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It would be nice if we have a little upside today.....Right now I would settle for flat...

 

The rest of the World not too pretty...Hope they were following and not leading us...Today.

 

New word on the European block...."Grexit"...If and when.

But still want to keep intact for other Euro Nations.

 

Get your red hot drachmas....Right here.

Aug 24, 2012 7:14PM
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ACHTUNG Serious Econ debaters....Check this Headline out....

Republicans eye a return to gold standard


(Yahoo Finance)...

Is gold money? Some Republicans think it should be.

The Republican Party is considering setting up a commission to examine the pros and cons of going back to the gold standard, according to draft documents of the party platform.

The official party platform won't be decided until Monday, but a Republican National Committee spokeswoman confirmed the draft language to CNN Money.


Federal Reserve Chairman Ben Bernanke has repeatedly expressed concerns about the idea, sometimes even sparring with Paul in Congressional hearings. Research has shown the rigid constraints of the gold standard worsened the Great Depression, he said. Gold prices can also be volatile.

Plus, there's not enough gold in the world to support such a system, as Bernanke noted in a lecture earlier this year.

"To have a gold standard, you have to go to South Africa or someplace and dig up tons of gold and move it to New York and put it in the basement of the Federal Reserve Bank of New York and that's a lot of effort and work," he said.


But  just in case the idea does gain more traction, here are some rough calculations of what would happen to gold prices, courtesy of Julian Jessop, chief global economist for Capital Economics.

The U.S. monetary base, which includes paper bills, coins and some deposits at the Fed, is currently around $2.6 trillion. Meanwhile, the U.S. Treasury and Federal Reserve hold about 260 million ounces in gold.

That means, if the government wanted every single dollar to be swapped with gold, the price of gold would have to be $10,000 per ounce.


-Good for Gold...bad for fiat.   I bet this gives Responder a shiver of delight.

Have a good weekend, all.....LOM

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