LONDON — Stock index futures at 6.30am ET indicate that the Dow Jones Industrial Average (DJINDICES: ^DJI) may open up by five points this morning, while the S&P 500 (SNPINDEX: ^GSPC) may open 1.3 points higher.
European markets were mixed this morning ahead of today’s US economic reports. New statistics showed that unemployment in the eurozone fell by 24,000 in June, the first decline since April 2011. However, the fall was not enough to reduce the eurozone unemployment rate, which remained unchanged at 12.1%. Retail sales fell in both Germany and Spain in June, leaving them down by 2.8% and 5.1% respectively, on an annualised basis. At 6.30am ET, the FTSE 100 was up 0.55%, the DAX was unchanged, and France’s CAC 40 was down 0.07%.
US investors will finally get what they’ve been waiting for today — the latest US GDP figures and an update from the Federal Reserve, following the conclusion of the FOMC’s latest two-day monetary policy meeting. Today’s US economic calendar kicks off at 8.15am ET with the ADP employment survey for July, which is expected to show that 185,000 jobs were added to payrolls in July, down slightly from 188,000 in June. At 8.30am, the government’s initial estimate of second-quarter GDP growth will be published. Consensus forecasts suggest that the US economy grew at an annualized rate of 1.0% in the second quarter, down from 1.8% in the first quarter. The much-awaited Fed announcement is due at 2pm, when investors will find out if the Fed is going to provide any further guidance on when it may begin to taper its bond-buying stimulus program.
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Despite the focus on economic data today, there are a number of corporate results that could shift stock prices today. Earlier this morning, Humana reported expectation-beating second-quarter earnings of $2.63 per share, up from $2.16 per share for the same period last year. Other companies due to report before the opening bell this morning include Hess, Exelon, Burger King Worldwide, Comcast, PG&E, MasterCard, Hudson City Bancorp and Energen.
Other stocks that may be actively traded this morning include pharmaceutical firm Amergen, which reported a rise in second-quarter sales after the close last night, and Riverbed Technology, which was down 16% in pre-market trading this morning, after reporting a second-quarter loss caused by rising expenses.
Finally, let’s not forget the Dow’s daily movements can add up to some serious long-term gains. Indeed, Warren Buffett recently wrote: “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.“
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> Roland does not own shares in any of the companies mentioned in this article.
