Tweet
Thursday September 30, 9:15 am ET
By Mark Cotton
NEW YORK (CBS.MW) - U.S. stock futures are pointing to a lower open Thursday, with blue chips leading the decline after shares of Dow component Merck plummeted on its announcement that it was withdrawing Vioxx, its blockbuster arthritis drug.
Dow futures were down 72 points, at 10,052, Nasdaq 100 futures fell 2.5 points, to 1,413 while S&P 500 futures slipped 2.20 points, to 1,113.
"We are going to get rapped on the Merck news but take that out, it's not having much of an impact on the Nasdaq and the S&P," said John Hughes, market analyst, at Shield's & Co.
"There is some general improvement which has been building, and we're looking for things to move higher once we get past this week."
On Wednesday, stocks ended at a one-week high after crude-oil prices closed lower for the first time in ten sessions.
The Dow Jones Industrial Average (^DJI - News) ended up 58.84 points at 10,136.24, its best closing level since September 21.
The Nasdaq Composite (NasdaqSC:^IXIC - News) rose 24.07 points, or 1.3 percent, to 1,893.94 while the S&P 500 index (CBOE:^SPX - News) gained 4.74 points, to 1,114.80.
A flurry of economic data offered investors a fresh snapshot of the current health of the economy.
Healthy wage growth boosted personal incomes by 0.4 percent in August, but consumer spending for the period remained flat, the Commerce Department estimated.
The rise in personal income was as expected, but economists had been forecasting a 0.2 percent rise in spending.
Meanwhile, the Labor Department reported that the number of people filing for state unemployment insurance for the first time rose by 18,000 to 369,000 last week, largely because of the powerful hurricanes that have ravaged the Gulf Coast.
Economists had been expecting about 343, 000 claims, according to a survey conducted by.
The day's other big economic event comes at 10 a.m. Eastern with the Chicago purchasing managers' index. Economists expect a slight gain to 58.1 percent in September from 57.3 percent in August.
Any reading over 50 percent shows growth in the regional economy.
The dollar remains under pressure in the wake of the latest data. After falling to two-month lows against the euro overnight, the U.S. currency was off nearly 0.6 percent at $1.2402.
Crude-oil futures were holding steady under $50 a barrel in electronic trading.
Merck plummets on Vioxx withdrawal
On the Dow, shares of Merck (NYSE:MRK - News) slumped 19 percent at $36.68 in pre-market trading in Instinet after the pharmaceutical giant said it was voluntarily withdrawing its arthritis and pain medication Vioxx effective immediately after a trial revealed increased relative risk for cardiovascular events.
Vioxx has been marketed in more than 80 countries and produced sales of $2.5 billion in 2003, which represents roughly 10 percent of total sales for the year.
The news boosted shares of Pfizer (NYSE:PFE - News) , which makes Celebrex, a rival arthritis treatment. The stock was up 5.4 percent in pre-market trading in Instinet.
IBM shares (NYSE:IBM - News) fell 0.3 percent in pre-market trading in Instinet after it said it would take a $320 million charge in the third quarter as part of an agreement to resolve certain claims in a lawsuit brought against its pension plan.
Pepsico shares (NYSE:PEP - News) got a lift ahead of the bell after the food and beverage giant reiterated its full-year outlook for earnings growth in the wake of third quarter earnings which topped Wall Street expectations by a penny.
Crosswinds are likely to buffet the semiconductor sector in early trading.
Overnight, Micron Technology (NYSE:MU - News) posted fourth quarter earnings, which came in well short of analyst expectations, prompting a downgrade from brokerage First Albany.
However, the range of estimates was wide since Micron doesn't provide initial financial targets. Bottom-line estimates from analysts ranged between 9 and 27 cents a share. Revenue predictions were spread between $1.15 billion and $1.32 billion.
Shares in the Boise, Idaho-based company, which makes dynamic random access memory chips, or DRAM, chips, were up 4 cents at $12.14 in pre-market trading in Instinet.
In better news for the sector, a closely-followed industry report showed a rise in global chip sales.
Worldwide sales of semiconductors rose 1.1 percent to $18.2 billion in August from July, or up 34.2 percent on the year, the Semiconductor Industry Association said.
Ahead of the bell, Intel (NasdaqNM:INTC - News) was up 8 cents at $20.15, while Advanced Micro Devices (NYSE:AMD - News) climbed 5 cents, to $12.85.
In other news, Nortel shares (NYSE:NT - News) were off a penny at $3.50 after it said it is planning to cut 3,250 jobs as part of its cost-cutting in R&D and administrative operations. The Canadian telecom equipment maker said its restructuring will lead to charges of $450 million, with the job cuts accounting for around $220 million of that total.
By Mark Cotton
NEW YORK (CBS.MW) - U.S. stock futures are pointing to a lower open Thursday, with blue chips leading the decline after shares of Dow component Merck plummeted on its announcement that it was withdrawing Vioxx, its blockbuster arthritis drug.
Dow futures were down 72 points, at 10,052, Nasdaq 100 futures fell 2.5 points, to 1,413 while S&P 500 futures slipped 2.20 points, to 1,113.
"We are going to get rapped on the Merck news but take that out, it's not having much of an impact on the Nasdaq and the S&P," said John Hughes, market analyst, at Shield's & Co.
"There is some general improvement which has been building, and we're looking for things to move higher once we get past this week."
On Wednesday, stocks ended at a one-week high after crude-oil prices closed lower for the first time in ten sessions.
The Dow Jones Industrial Average (^DJI - News) ended up 58.84 points at 10,136.24, its best closing level since September 21.
The Nasdaq Composite (NasdaqSC:^IXIC - News) rose 24.07 points, or 1.3 percent, to 1,893.94 while the S&P 500 index (CBOE:^SPX - News) gained 4.74 points, to 1,114.80.
A flurry of economic data offered investors a fresh snapshot of the current health of the economy.
Healthy wage growth boosted personal incomes by 0.4 percent in August, but consumer spending for the period remained flat, the Commerce Department estimated.
The rise in personal income was as expected, but economists had been forecasting a 0.2 percent rise in spending.
Meanwhile, the Labor Department reported that the number of people filing for state unemployment insurance for the first time rose by 18,000 to 369,000 last week, largely because of the powerful hurricanes that have ravaged the Gulf Coast.
Economists had been expecting about 343, 000 claims, according to a survey conducted by.
The day's other big economic event comes at 10 a.m. Eastern with the Chicago purchasing managers' index. Economists expect a slight gain to 58.1 percent in September from 57.3 percent in August.
Any reading over 50 percent shows growth in the regional economy.
The dollar remains under pressure in the wake of the latest data. After falling to two-month lows against the euro overnight, the U.S. currency was off nearly 0.6 percent at $1.2402.
Crude-oil futures were holding steady under $50 a barrel in electronic trading.
Merck plummets on Vioxx withdrawal
On the Dow, shares of Merck (NYSE:MRK - News) slumped 19 percent at $36.68 in pre-market trading in Instinet after the pharmaceutical giant said it was voluntarily withdrawing its arthritis and pain medication Vioxx effective immediately after a trial revealed increased relative risk for cardiovascular events.
Vioxx has been marketed in more than 80 countries and produced sales of $2.5 billion in 2003, which represents roughly 10 percent of total sales for the year.
The news boosted shares of Pfizer (NYSE:PFE - News) , which makes Celebrex, a rival arthritis treatment. The stock was up 5.4 percent in pre-market trading in Instinet.
IBM shares (NYSE:IBM - News) fell 0.3 percent in pre-market trading in Instinet after it said it would take a $320 million charge in the third quarter as part of an agreement to resolve certain claims in a lawsuit brought against its pension plan.
Pepsico shares (NYSE:PEP - News) got a lift ahead of the bell after the food and beverage giant reiterated its full-year outlook for earnings growth in the wake of third quarter earnings which topped Wall Street expectations by a penny.
Crosswinds are likely to buffet the semiconductor sector in early trading.
Overnight, Micron Technology (NYSE:MU - News) posted fourth quarter earnings, which came in well short of analyst expectations, prompting a downgrade from brokerage First Albany.
However, the range of estimates was wide since Micron doesn't provide initial financial targets. Bottom-line estimates from analysts ranged between 9 and 27 cents a share. Revenue predictions were spread between $1.15 billion and $1.32 billion.
Shares in the Boise, Idaho-based company, which makes dynamic random access memory chips, or DRAM, chips, were up 4 cents at $12.14 in pre-market trading in Instinet.
In better news for the sector, a closely-followed industry report showed a rise in global chip sales.
Worldwide sales of semiconductors rose 1.1 percent to $18.2 billion in August from July, or up 34.2 percent on the year, the Semiconductor Industry Association said.
Ahead of the bell, Intel (NasdaqNM:INTC - News) was up 8 cents at $20.15, while Advanced Micro Devices (NYSE:AMD - News) climbed 5 cents, to $12.85.
In other news, Nortel shares (NYSE:NT - News) were off a penny at $3.50 after it said it is planning to cut 3,250 jobs as part of its cost-cutting in R&D and administrative operations. The Canadian telecom equipment maker said its restructuring will lead to charges of $450 million, with the job cuts accounting for around $220 million of that total.