The Day Ahead: Waiting on Reports

 | Dec 08, 2011 | 8:21 AM EST
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In the Headlines

Futures on Wall Street were mixed on Thursday, leading up to the eurozone summit and the Labor Department's weekly jobless claims data.

The European Central Bank (ECB) said it would slash the key interest rates by 25 basis points, to 1%, as analysts had expected. ECB chief Mario Draghi is slated to hold a press conference at 8:30 a.m. EST, during which his remarks will likely be parsed and analyzed.

U.S. stock futures improved following on the interest-rate news, while European indices moved into positive territory.

Nasdaq and DJIA futures indicated a higher open, while the S&P 500 was poised to begin the session essentially flat. 

The euro was trading to the downside vs. the dollar, but strengthened from lower levels earlier this morning.   

Before the ECB rate announcement, the Bank of England said it would leave interest rates unchanged at 0.5%. Also, bond rater Fitch said Italy's austerity plans have eased ratings pressure on that nation.

At 8:30 a.m., the Labor Department's jobless claims report is expected to show a decline to 395,000 from last week's 402,000.

Commodities Corner

Crude oil was up $0.29 per barrel to $100.78, while gold fell $2.10 per ounce, to $1,742.70 in electronic trading.

Earnings News

Earnings news today included a first-quarter report from Costco (COST), which said income was $0.73 a share, with sales of $21.18 billion. Results were below analysts' expectations for earnings of $0.80 per share and revenue of $21.29 billion, although the top and bottom lines showed year-over-year gains. Costco shares fell $0.42, or 0.48%, to $87.05 in early trade.

Brown-Forman (BFA), distributor of Jack Daniel's, Finlandia and Korbel, among other brands, is expected to report third-quarter income of $1.09 per share on revenue of $955.79 million. The shares have been rallying to new highs, and upside volume has come in above average in some sessions recently.

After the bell, Pall (PLL), which makes filtration and purification gear for life sciences and industrial customers, is scheduled to report its first quarter. The S&P 500 component is expected to earn $0.65 a share on revenue of $647.99 million. Earnings growth rates have slowed in the past two quarters.

Market Movers

In company news, DJIA component Boeing (BA) said machinists' union workers had OK'd a contract with the company. The move is expected to end a lawsuit from the National Labor Relations Board. Boeing shares gained $0.40, 0.57%, to $71 in early trade.

Verizon (VZ) was another early mover, gaining $1.18, 3.08%, to $39.49. The company is said to be joining forces with Coinstar's (CSTR) Redbox to develop a streaming video service.

A decliner in the premarket was MEMC Electronics (WFR), dropping by $0.11, or 2.61%, to $4.10. The maker of equipment for semiconductors and solar panels said it would slash 1,300 jobs, and warned that revenue would come in below estimates.

Analyst Actions

Analyst actions included a Janney Capital downgrade of Las Vegas Sands (LVS) to Neutral from Buy. Janney cited high expectations for the company's Macau business, and slower-than-expected Singapore growth. It also lowered its price target on the stock to $48 from $57. Las Vegas Sands fell $0.50, or 1.10%, to $45.12 ahead of the bell.



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