Stock futures flat after selloff; Q2 earnings weigh
U.S. stock index futures pointed to a flat open on Wednesday, after hitting a 10-week low the previous session, as anxious investors awaited the start of quarterly earnings season.
After a rally that took the S&P 500 index up 40 percent from 12-year lows in early March, traders are looking for hard evidence that the economy will rebound from a deep recession.
But corporate earnings are seen to be weak. Alcoa Inc
The economy's weakness notwithstanding, investors could be enticed by bargains after Tuesday's 2 percent drop.
(Traders) sold it hard at the close yesterday and now they're going to wait and see, so that void is allowing the market to pop back up, said Marc Pado, U.S. market strategist at Cantor Fitzgerald & Co in San Francisco.
It's not that you have real buying going on here.
S&P 500 futures were unchanged but were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures edged down 1 point, and Nasdaq 100 futures dropped 1.25 points.
In the technology sector, Google Inc
Leaders of the Group of Eight richest nations and the major developing powers are gathering for a three-day summit in Italy. They are expected to agree the world's economy is still too weak to remove stimulus measures.
New York crude futures fell 1.4 percent and was headed to its sixth straight negative session, which could pressure shares in the energy sector.
On the data front, the U.S. Federal Reserve is due to issue May consumer credit figures at 3 p.m. EDT. Economists surveyed by Reuters forecast consumer credit falling $9.5 billion versus a $15.68 billion decrease in April.
3M Co
U.S. stocks fell to their lowest level in 10 weeks on Tuesday as talk of a second government stimulus plan heightened fears that the economy was not yet on the path to recovery and corporate earnings for the second quarter would be weak.
(Reporting by Rodrigo Campos; additional reporting by Leah Schnurr; editing by Jeffrey Benkoe)
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