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Futures Turn Lower After Caterpillar Earnings

Futures dipped Friday after Caterpillar's earnings missed estimates, erasing earlier gains froM GE and an agreement on a new Greek rescue deal.

European banks and insurers rose on Friday after Greece’s private sector creditors agreed to take a 21 percent loss on their debt holdings as part of the Greek rescue plan.

With the clock ticking toward an August 2 deadline to raise the US debt ceiling, the focus shifts to Washington on Friday where efforts to avoid a US default enter crunch time.

The main obstacle remains the issue of tax increases that Obama's Democrats demand and Republicans vehemently oppose.

Caterpillar slumped after the Dow component posted earnings that fell short of estimates, despite reporting revenue that topped expectations and raising its forecast for the year to reflect the acquisition of Bucyrus.

Among other Dow giants, GE reported a robust rise in profit, helped by strong international demand its heavy equipment including jet engines and electric turbines.

Verizon also topped earnings estimates, boosted by the wireless communication firm's iPhone sale, adding more new subscribers on contracts in the second quarter than it has in two and half years.

And McDonald's gained to hit an all-time high, after the fast-food chain posted earnings that exceeded expectations.

Microsoft reported earnings ahead of analyst forecasts on Thursday afternoon, helped by sales of its Office software and Xbox game consoles; but profit from its Windows operating system fell on weak PC sales.

On Tap Next Week:

MONDAY: Dallas Fed survey, USDA food prices outlook; Earnings from Texas Instruments, Broadcom, Netflix
TUESDAY: S&P Case-Shiller home price index, consumer confidence, new home sales, Richmond Fed survey, 2-yr note auction; Earnings from BP, Deutsche Bank, Ford, GlaxoSmithKline, 3M, UBS, UPS, US Steel, Amazon.com, Electronic Arts
WEDNESDAY: Weekly mortgage apps, durable goods orders, oil inventories, 5-yr note auction, Beige Book; Earnings from Boeing, ConocoPhillips, Aetna, AutoNation, Delta, Dow Chemical, Aflac, Symantec, Visa, WholeFoods
THURSDAY: Weekly jobless claims, pending home sales, Kansas City Fed survey, Richmond Fed Lacker speaks, 7-yr note auction, San Francisco Fed Williams speaks, money supply; Earnings from AstraZeneca, Credit Suisse, DuPont, ExxonMobil, Royal Dutch Shell, Sanofi, Bristol-Myers Squibb, DR Horton, Kellogg, Motorola Solutions, Sprint, Time Warner Cable, Chesapeake Energy, MetLife, Motorola Mobility, Starbucks
FRIDAY: Employment cost index, GDP, Chicago PMI, consumer sentiment, farm prices; Earnings from Chevron, Merck

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