Futures Point Lower as Intel, Wal-Mart Drop

Stock futures indicated a lower open Wednesday as Intel's after-hours earnings report the day before dragged down tech stocks and a warning from Wal-Mart hit the broader indexes.

Futures pared a bit of their losses following a report showing that manufacturing in New York contracted less severely than expected, while consumer prices took an unexpected drop, recording their first annual drop since 1955.

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In other economic news, mortgage applications fell last week even though borrowing rates remained low. However, the report does not adjust for holiday weeks, so last week's Good Friday holiday leading into Easter likely hampered activity somewhat.

Still to come: U.S. industrial production and capacity utilization data for March are due for release at 9:15 am ET, followed by the The NAHB's April housing-market index at 1 pm and the Federal Reserve's "beige book" of regional economic conditions at 2 pm.

Global tech stocks declined as Intel reported earnings of 11 cents a share, less than half of the 25 cents it earned a year earlier, but managed to beat expectations. The big takeaway was that Intel said PC sales "bottomed out" in the first quarter — essentially calling a bottom — but what rattled the sector was that the chip giant refused to provide an outlook.

Intel shares were down more than 4 percent in pre-market trading.

Grim results from the Netherlands' ASML and India's Infosys also contributed to the fall in tech stocks.

"Tech stocks have moved significantly this year … so perhaps they have gotten a little bit ahead of themselves," Hank Smith, chief investment officer at Haverford Investments said on CNBC this morning.

There is a false sense of optimism over the economy and in the markets, this is still a bear market and the current rally is a bear-market rally, Smith said.

Meanwhile, Wal-Mart cast a shadow over the market after the CEO Mike Duke said he doesn't see a quick end to the recesssion as weakness persists.

In Asia, Dallas Fed President Richard Fisher said he shared President Obama's view that though the U.S. economy is not "out of the woods" yet but added that there are "glimmers of hope" for a recovery in the future.

"The stimulus program is kicking in, our efforts to restore some vibrancy to the credit markets are taking grip", Fisher told CNBC.

Financial shares were under pressure as investors worry that Goldman Sachs's share offering could prompt other banks to follow suit.

JPMorgan Chase and Citigroup are expected to report first-quarter earnings later this week. Bank of America reports on Monday.

According to a New York Times report, the Obama administration is drawing up plans to disclose the conditions of the 19 banks in the country and will reveal some sensitive details of the stress tests now being completed.

European banks took a hit Wednesday after UBS , Switzerland's largest bank, said it will cut 8,700 jobs and expects a $1.75 billion first-quarter loss.

In other jobs-related news, Yahoo is planning to cut hundreds of jobs ahead of its first-quarter earnings report, the New York Times reported.

On the plus side for tech, eBay said it had reached a tentative agreement to buy a controlling stake in its South Korean counterpart GMarket, the largest such company by revenue in that country. The deal would be valued at $24 a share, the Wall Street Journal reported.

After the closing bell on Tuesday, BlackRock announced plans to raise $5 billion to $7 billion worldwide to buy toxic assets from U.S. financial institutions under a planned US government program.

Abbott Laboratories is due to report first-quarter earnings before the bell. The drug and medical device company expects earnings to come in around 69 to 71 cents per share.

Still to Come:

WEDNESDAY: Industrial production; weekly crude inventories; NAHB housing index; Fed's beige book
THURSDAY: Housing starts; weekly jobless claims: Philly Fed survey; Fed's Lockhart, Yellen speak; Earnings from JPMorgan, Harley-Davidson, Nokia, Southwest Air and Google
FRIDAY: CNBC's 20th Anniversary; consumer sentiment; Bernanke speaks; Earnings from Citigroup, GE and Mattel

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