Futures inch higher ahead of the Fed

Markets on edge as the 2-day Federal Reserve policy meeting begins Tuesday.

By Benzinga Jun 18, 2013 8:27AM

zurbar age fotostockBy Matthew Kanterman


U.S. equity futures rose slightly in premarket trade Tuesday as investors eagerly awaited the Federal Reserve policy decision and statement Wednesday. Monday trading was a whip-saw marked by a steep sell-off over tapering fears.


In other news, the German ZEW Economic Sentiment Index rose to 38.5, beating expectations of a reading of 38.1 and better than the prior 36.4.


European Central Bank President spoke in Jerusalem overnight and hinted that the long-term refinancing operations could be extended as a means of providing additional bank liquidity. Speculation had grown that the ECB could do this however it is the first time Draghi has addressed it directly.


European car sales fell to a 20-year low in May as new car registrations fell to 1.08 million from 1.15 million a year ago. Sales at General Motors (GM) fell over 10%.

  • S&P 500 futures rose 2.8 points to 1,636.50.

  • The EUR/USD was higher at 1.3396.

  • Spanish 10-year government bond yields fell 1 basis point to 4.57%.

  • Italian 10-year government bond yields fell 1 basis point to 4.26%.

  • Gold fell 0.41% to $1,377.40 per ounce.

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Asian markets

Asian shares were mixed overnight in unusually quiet trading as markets eagerly anticipate the Fed's decision -- the proverbial calm before the storm. The Japanese Nikkei 225 Index declined 0.2% and the Topix Index gained 0.15%. Shares in Hong Kong were flat while the Shanghai Composite Index gained 0.41%. Also, the Korean Kospi rose 0.93% while Australian shares fell 0.24%.


European markets

European shares were mixed overnight ahead of the Fed following mixed regional economic data. The Spanish Ibex Index rose 0.41% and the Italian FTSE MIB Index gained 0.16%. Meanwhile, the German DAX fell 0.32% and the French CAC 40 fell 0.31% while the U.K. FTSE rose 0.36%.


Commodities

Commodities were weaker overnight, erasing Monday's gains. WTI crude futures fell 0.2% to $97.57 per barrel and Brent crude futures declined 0.19% to $105.27 per barrel. Copper futures fell 0.75% to $317.35 per pound. Gold was lower and silver futures fell 0.22% to $21.71 per ounce.


Currencies

Currency markets sang a familiar tune overnight as the yen and the Australian dollar weakened precipitously. The EUR/USD was higher at 1.3396 and the dollar gained against the yen to 95.14. Overall, the Dollar Index fell 0.17% on weakness against the euro and the Canadian dollar.Gen


Earnings reported Monday

Key companies that reported earnings Monday include:

  • Korn/Ferry International (KFY) reported fourth quarter earnings per share of $0.32 vs. $0.31 expected on revenue of $238.6 million vs. $223.58 million.

Premarket movers

Stocks moving in the premarket included:

  • Genmark Diagnostics (GNMK) shares fell 4.74% premarket after the company lowered full-year revenue guidance.

  • Rambus (RMBS) shares climbed 3.85% premarket after the company signed a new contract with STMicroelectronics (STM).

  • New Mountain Finance (NMFC) shares declined 3.16% premarket after the company announced a secondary offer.

Earnings

Notable companies expected to report earnings Tuesday include:

  • Adobe (ADBE) is expected to report second quarter earnings per share of $0.34 vs. $0.60 a year ago.

  • FactSet Research Systems (FDS) is expected to report third quarter earnings per share of $1.15 vs. $1.05 a year ago.

  • La-Z-Boy Inc. (LZB) is expected to report fourth quarter earnings per share of $0.28 vs. $0.18 a year ago.

Economics

On the economics calendar Tuesday, CPI and the NAHB home price index are due out as well as the Redbook and housing starts. Overnight, the Japanese trade balance and the Bank of England Monetary Policy Committee minutes are due out.


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