Futures Decline as Latest Greek Deal Rejected
U.S. stock index futures pointed to a lower open Tuesday as concerns about the European debt crisis continued to weigh and as investors digested a handful of mixed corporate earnings reports.
EU finance ministers rejected proposals by private bondholders over the extent of the “haircut” they were willing to acceptin order to avoid a Greek default on its debts in March.
Elsewhere, the International Monetary Fund’s (IMF) managing director, Christine Lagarde, told CNBCthe organization needs an additional $500 billion to help contain the spreading European debt crisis.
With about $150 billion committed from member countries so far, the IMF is seeking to convince its members that putting together a strong enough fund to block off euro zone contagion is vital for the global economy.
In a busy morning for earnings, DuPont slipped even after the chemical company reported earnings that topped expectations, but revenue missed estimates.
Johnson & Johnson posted earnings that beat expectations but shares tumbled after the drugmaker issued guidance that disappointed.
Travelers reported earnings that were slightly below analysts' forecasts.
Fellow Dow component Verizon reported a loss due to a non-cash pension charge and high costs from strong sales of the Apple iPhone. Apple is scheduled to post earnings after-the-bell tonight.
Meanwhile, McDonald's gained after the fast-food giant delivered quarterly results that beat expectations.
In corporate news Texas Instruments reported better-than-expected fourth-quarter chip sales as customers in a broad area of industries replenished depleted inventories.
Boeing won a $693 million contract modification to build five more C-17 transport planes for the U.S. Air Force.
Among techs, hard drive maker Western Digital also posted better-than-expected quarterly results and forecast a strong current quarter, signaling a faster-than-anticipated return to production capacity at key facilities damaged by the floods in Thailand last year.
Software maker VMware also reported profits ahead of expectations and raised hopes that technology spending would grow this year.
Semiconductor company Semtech said it is planning to acquire Canada's Gennum for about $497 million.
Also on the M&A front, U.S.-based Watson Pharmaceuticals said it bought the Australian and South East Asian generic drugs business of India's Strides Arcolab for $396 million.
And Starbucks the world's biggest coffee chain, plans to sell beer and wine in as many as 12 cafes in Atlanta and Southern California by the end of the year.
The Federal Reserve begins its two day monthly meeting with an announcement on interest rates due on Wednesday before a press conference with Fed chairman Ben Bernanke. And for the first time, the central bank will unveiling policymakers' interest rate projections in a move for more transparency.
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Coming Up This Week:
TUESDAY: 2-yr note auction, FOMC meeting begins, Obama's State of the Union address; Earnings from Apple, Yahoo
WEDNESDAY: Weekly mortgage apps, FHFA house price index, pending home sales, oil inventories, FOMC meeting announcement, Bernanke press conference; Earnings from Boeing, ConocoPhillips, United Tech, Delta, Motorola Solutions, Amgen, Netflix, SanDisk, Symantec
THURSDAY: Durable goods orders, jobless claims, new home sales, leading indicators, 7-yr note auction; Earnings from AT&T, Caterpillar, 3M, Nokia, AutoNation, Bristol-Myers, Time Warner Cable, Motorola Mobility, Starbucks
FRIDAY: GDP, consumer sentiment; Earnings from Chevron, P&G, DRHorton
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