GO
Loading...

US futures turn flat following Citi earnings

U.S. stock index futures pointed to a flat open on Wall Street on Tuesday after weak earnings from Citigroup dampened earlier enthusiasm that Washington was nearing a budget deal.

Shares in Europe and Asia trading up on hopes of a pending agreement in Congress.

Citigroup's reported a dip in adjusted profit of $1.02 a share, about four cents lower than the same period in 2012, though only a penny off estimates. Shares dropped 0.4 percent in premarket trading.

"Markets will be closely watching the momentum in the mortgage businesses, particularly after the slowdown in refinancing volumes and cost cuts reported in the JPM (JPMorgan Chase) and Wells Fargo results late last week," said Deutsche Bank analysts Jim Reid and Anthony Ip in a research note.

Coca-Cola edged higher after the beverage maker posted reported higher quarterly earnings as robust sales of its drinks helped offset the effects of global economic pressures.

And fellow Dow component Johnson & Johnson rose after the diversified health care company topped quarterly expectations and the company lifted its full-year profit forecast.

Intel, Yahoo and CSX are slated to post earnings after the closing bell.

Senate majority leader Harry Reid ended talks with his Republican counterpart, Mitch McConnell, late on Monday, and said a short-term funding deal could be announced on Tuesday. The deal would end the government shutdown and raise the debt ceiling by just enough to cover the nation's borrowing needs past year-end.

(Read more: US senators hint at possible fiscal deal on Tuesday)

House Majority Leader Eric Cantor said that Republican lawmakers will hold a closed-door meeting on Tuesday "to discuss a way forward, so stayed tuned".

However, Daiwa Capital Market's Chris Scicluna forecast that no deal would be struck this week.

"While certain elements of possible solutions to the U.S.fiscal impasse continue to be mooted — for example, with talk of Senate Democrats bringing forward a bill this week that would facilitate a raise in the debt ceiling; a Republican senator floating a plan for a grand bargain involving new spending cuts and tax reforms; and Obama indicating his willingness to kick the can down the road again with a short-term increase in the debt ceiling — political intransigence remains the main theme in the U.S.," he said in a morning research note.

On the economic front, the pace of growth in New York state's manufacturing sector slipped in October to its slowest since May, according to the New York Fed's "Empire State" general business conditions index.

New York Fed President Dudley is scheduled to speak about monetary policy and Chairman Ben Bernanke will speak at the Mexico central bank.

(Read more: Companies worry about 'stepping on a bomb')

In other stock news, Apple announced that long-standing Burberry Chief Executive Angela Ahrendts would take up its new post of senior vice-president of retail and online stores, reporting to CEO Tim Cook. Shares in luxury fashion house Burberry traded 4 percent lower on the news, and were the worst performers on London's FTSE 100.

Contact US

  • CNBC NEWSLETTERS

    Get the best of CNBC in your inbox

    › Learn More*