Might be good for at least a day trade as I don't think Intel is the bell-weather it used to be...
Stocks set to plunge on Intel shortfall By LESLIE WINES, AP Business Writer
Wall Street readied for a second straight day of losses Wednesday after technology leader Intel Corp. announced disappointing earnings and a dim outlook.
Investor patience already is sorely tested by economists' predictions that a recession is at hand and by unsteadiness in the financial sector, where many banks are struggling to restore badly damaged balance sheets.
Intel's failure to meet earnings and revenue forecasts for the fourth quarter and new first-quarter revenue guidance that is at the low end of analysts' forecasts should weary investors further. Earlier this week there was market speculation that the technology sector, which sometimes benefits from a weak dollar and overseas strength, might be able to withstand the weakness sweeping other parts of the economy.
Intel stock fell as much as 15 percent in after hours trade and contributed to heavy selloffs in Asia on Tuesday. The share was indicated to open lower on Wednesday.
The futures contract for the Dow Jones industrial average fell 109 points to 12,455. Intel is a Dow component.
Futures contracts for the S&P 500 dropped 12.00 points to 1,376.00 as the Nasdaq 100 contract gave up 30.2 points to 1,881.8.
Treasury prices rose on the expected declines for stocks as oil futures came under pressure. The dollar should be back in the spotlight Wednesday, after hitting sharp lows overnight in Asian trade due to the fears of a U.S recession.
JPMorgan Chase & Co. Wednesday offered a first-quarter earnings report that revealed relatively light exposure to the subprime lending crisis as it took a writedown of $1.3 billion. The company had a quarterly profit that fell below analysts' expectations.
But, on a worrisome note, the bank warned of difficult conditions ahead in 2008.
Wells Fargo & Co.'s report also is expected Wednesday.
New data Wednesday will provide insight into the pace of inflation and the strength of production.
The consumer price report for December is expected to show increases of 0.2 percent for both the headline figure and the core rate, which strips out the more volatile prices of food and energy, according to Thomson/IFR. Those results would show that inflation moderated in the month as the headline figure rose 0.8 percent in November and the core rate advanced 0.3 percent.
December's industrial production report is expected to show a 0.2 percent decline in output, after a 0.3 percent November gain.
In overseas trade, Japan's Nikkei gave up 3.35 percent. In Europe, London's FTSE 100 fell 1.13 percent, Frankfurt's DAX fell 1.05 percent and Paris' CAC forfeited 0.82 percent. |
