Stock index futures fell ahead of the open after news of a surprising fall in durable goods orders for April, and amid continuing concerns over the euro zone debt crisis.
Durable goods orders fell 3.6 percentin April from an upwardly revised 4.4 percent gain in March, the Commerce Department reported. The drop was the largest in six months, led by a fall in aircraft and motor vehicle orders.
Economists surveyed by Reuters had expected durable goods to fall 2.2 percent. The report provides further evidence that manufacturing activity in the U.S. is slowing down.
In Europe, the Greek Prime Minister’s office denied the prospect of a snap election in the country in a CNBC interview. Greece has been forced to step up austerity efforts and the Greek people are increasingly angry about the spending cuts they face.
Investors are worried that other countries such as Ireland and Portugal may want to restructure their debt as well if Greece does.
In stocks news, Martha Stewart Living soared on news from the media and merchandising company retained Blackstone Advisory Partners to explore strategic alternatives. The company also announced that Martha Steward is expected to rejoin the Martha Stewart Living board in the third quarter.
American International Group fell after the U.S. Treasury sold 200 million shares at $29 a share, slightly more than the Treasury needs to recoup its investment. The total $8.7 billion sale included 100 million shares sold by AIG.
Costco fell after saying a boost in gasoline salesin the last quarter hurt its profit margins, despite posting a boost in profits.
Shares of Hormel fell despite posting better-than-expected sales, and offering a strong earnings outlook.
Cisco traded slightly lower after news that language in its quarterly performance report filed with the Securities and Exchange Commission was slightly revised say revenue growth this quarter would be "relatively flat," instead of "flat to up 2 percent," the language the networking firm used in an earlier earnings conference call.
Also in U.S. economic news, the Mortgage Bankers Association'sseasonally adjusted index of mortgage application activity rose 1.1 percent last week, the fourth weekly rise. Refinancing applications gained 0.9 percent, while requests for home loans gained 1.5 percent.
Oil jumped Tuesday after Goldman Sachs raised its price forecast for Brent crude to $130 per barrel over the next year and said investors should now buy oil, copper and zinc. Weekly crude inventories will be released by the government at 10:30 a.m.
French Finance Minister Christine Lagarde announced she is officially in the running for the top job at the IMF on Wednesday, although Brazil, China, India, Russia and South Africa have criticized European officials for suggesting the next head should automatically be a European.
On Tap This Week:
WEDNESDAY: Oil inventories, five-year Treasury note auction; Minneapolis Fed President Narayana Kocherlakota speaks; USDA Food Prices Outlook, BlackRock shareholder meeting, ExxonMobil shareholder meeting, Yahoo investor day.
THURSDAY: GDP, USDA Agricultural Trade Outlook, jobless claims, corporate profits, natural gas inventories, seven-year Treasury note auction, money supply; earnings before-the-bell from Sony and Tiffany.
FRIDAY: Personal income and spending, consumer sentiment, and pending home sales.
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