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Analyst Cuts Goldman Sachs Outlook

S&P futures dropped 6 points on the disappointing U.S. May retail sales. But it was noted that building material sales were notably weak, down 9.3 percent, which may be due to the expiration of the homebuyer tax credit. Still, motor vehicle parts were down 1.7 percent, clothing sales were also down 1.3 percent. Sales up at restaurants, sporting goods, furniture.

Elsewhere this week the news has been more positive:

1) Spain and Italy had successful debt auctions, easing sovereign debt concerns short-term;

2) excellent employment reports from South Korea and Australia;

3) positive news on exports from China.

Positive earnings from Banco Santander , as well as affirmation that they will continue to pay their dividend, have also helped Europe

Elsewhere:

1) BP, Transocean and Anadarko trading up again pre-open.

The Times of London says BP is planning to defer its dividend by placing the money in an escrow account until the full extent of its liabilities can be determined. CEO Tony Hayward says the company could cut the dividend, defer it, or pay some or all of it in scrip.

2) National Semiconductor (NSM) rises 1 percent after Q4 earnings topped estimates ($0.33 vs. $0.28 consensus). Strong demand for its analog products that are used in the cellphone and industrial industries caused revenues to grow more than expected and the chipmaker is optimistic that that trend will continue.

The company sees revenues of $410 million-$418 million vs. $391 million consensus and forecasts a higher-than-expected gross margin rate

3) Express , the apparel retailer which recently celebrated its IPO, reported earnings of $0.50, as operating income more than doubled from last year. Profits were boosted by a strong 12 percent rise in same-store sales and a 7 percentage point jump in margins.

Comps are expected to grow mid to high single digits in the current quarter, with earnings seen between $0.05-$0.07 - a stark contrast to the $0.09 loss per share in the year-ago quarter. No consensus estimate is available yet since the company only went public 3 weeks ago.

4) Lots of talk about the 2 percent drop in Goldman Sachs yesterday...the only major financial down.

While most noted a new lawsuit in Australia and continuing headline risk around the government investigation, Atlantic Equities cut Q2 earnings estimates late last night, noting the difficult trading environment:

"During May investors de-risked and during June they have become highly inactive" and that "Deteriorating markets and increasing uncertainty in Europe have also had a meaningful impact on M&A and underwriting activities."

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