This was written by CNBC producer, Robert Hum
Futures are off their highs and are set for a fairly flat open this morning. While futures strengthened following an encouraging report out of Ford early this morning, a round of cautious earnings guidance from other industrial companies dampened investors’ enthusiasm.
Additionally, while futures moved up slightly following a better-than-expected March durable goods report at 8:30am ET this morning, futures retraced a bit of those gains as investors digested a modest revision to the February number, which was lowered to +2.1 percent from +3.5 percent.
Futhermore, the street awaits more details on the methodology of the government’s bank stress tests which will be released at 2pm ET today.
A Relatively Upbeat Report from Ford
Ford is surging 22 percent after posting a narrower-than-expected Q1 loss. More important, the automaker said it wasn’t seeking cash from the U.S. government, and that it expects to break even in 2 years.
CFO Lewis Booth said that cash burn would be less for the remainder of the year. This comes as competitors GM and Chrysler seek more cash and attempt to avoid falling into bankruptcy amid the continued auto industry struggles.
Other Industrials Remain Cautious
Shares of Dow component 3M are trading down 2 percent after notably lowering their full-year earnings and revenue guidance. The conglomerate’s Q1 profit fell 48 percent, as earnings fell below estimate amid slumping demand.
CEO George Buckley noted that their results were “significantly” affected by "substantial end-market declines and continued inventory takedowns in major industries.” Quite notable was the 27.5 percent plunge in industrial and transportation sales and the steep 30.2 percent plunge in sales at its display and graphics unit.
Diversified industrial Honeywell is up fractionally pre-open as it saw a 38% in earnings and cut its full-year forecast. Sales continue to be hurt by the weak economy. Despite those struggles though, both its earnings from the past quarter and its new 2009 guidance fall inline with the street’s expectations.
Truckers YRC Worldwideand Con-Wayboth reported greater-than-expected losses as they each experienced weak industry demand. Per day tonnage for Con-Way Freight fell 12 percent, while per day tonnage for YRC National Transportation plunge 29.5%.
Earnings at Microsoft were inline with estimates, amid better cost management. Microsoft saw sales fall 6% in its third quarter.
While the company still isn't providing any revenue or earnings guidance for the year, they lowered its 2009 operating expense estimates to $26.7 billion-$26.9 billion from $27.4 biillion. The software maker is up 4 percent pre-open.
Shares of American Expressstrengthen 7 percent after its Q1 earnings handilybeat estimates. While spending volume in its credit cards have dropped 16 percent, results were helped by cost cuts – which the company expects to continue in the second quarter.
Its loan loss provision surged 49 percent from last year and grew 29 percent from the Q4 of last year as write-offs continued to climb in the past quarter. Additionally, the CEO expects write-off will keep growing, rising 2 to 2.5 percentage points from Q1 levels.