What’s the Story

by CC September 17, 2012 9:17 am • Commentary


U.S. stock-index futures fell, after the benchmark Standard & Poor’s 500 Index rallied last week to its highest level since 2007, as manufacturing in the New York region contracted more than forecast in September.

Bank of America Corp. (BAC) and JPMorgan Chase & Co. (JPM) slid more than 0.9 percent after two weeks of gains. Wells Fargo & Co. (WFC) fell 0.9 percent after being downgraded at Stifel Nicolaus & Co. Cliffs Natural Resources Inc. (CLF) lost 2.9 percent after its rating was cut by JPMorgan Chase & Co. Office Depot Inc. (ODP) rose 8.9 percent after Starboard Value LP took a stake in the company.

S&P 500 futures expiring in December slid 0.2 percent to 1,456.30 at 8:45 a.m. in New York. The benchmark equities gauge last week rallied to the highest level since December 2007 as the Federal Reserve’s plan to buy mortgage securities fueled demand for riskier assets. Dow Jones Industrial Average futures lost 22 points, or 0.2 percent, to 13,496 today.


European stocks and the euro both eased on Monday, beginning a new week in cautious fashion after the prospect of fresh U.S. economic stimulus propelled both to multi-month highs in the previous session.

Promised support from the U.S. and euro zone central banks should see both push on to fresh highs in the coming weeks, traders said. The Federal Reserve announced last week that it plans to pump an extra $40 billion a month into the economy until jobs data improves, while the European Central Bank outlined its new bond-buying initiative earlier in the month.

At 0842 GMT, the FTSEurofirst 300 index of leading European stocks was down 0.2 percent at 1,118.18 points, pulling back from a 14-month high hit in the previous session. World stocks were also down 0.2 percent.

Asian stocks were generally higher overnight, with the MSCI Asia ex-Japan index hitting a 4-1/2 month high, although Tokyo markets were closed. U.S. stocks ended Friday near five-year highs.


Manufacturing activity in the New York region weakened again in September, according to data released Monday, raising fresh concern over loss of momentum in the factory sector.

The Empire State index decreased to negative 10.4 in September from negative 5.9 in August, according to the manufacturing survey released by the New York Federal Reserve. It is the lowest reading since November 2010.

The drop was a surprise. Economists surveyed by MarketWatch had expected the index to improve to 0.0.


Apple Inc. said Monday that pre-orders for the iPhone 5 topped 2 million units in the first 24 hours after the company began taking orders for the smartphone. Pre-orders for the iPhone 5 began on Friday. The results topped pre-orders for last year’s iPhone 4S, which topped more than a million units in its first 24 hours, as well as the iPhone 4 in 2010, which totaled more than 600,000 units in the same period. The iPhone 5 goes on sale in stores on Friday. Apple shares rose 0.8% in preopen trading, to $697 on Monday morning.