Dow points to red on Japan downgrade, Apple, Facebook in focus
U.S. equity markets looked set to open lower Tuesday after Fitch Ratings cut Japan’s credit rating, citing rising public debt and slow deficit-reduction efforts.
In pre-market trading, the Dow Jones Industrial Average dropped 13 points, or 0.1%, to 12,477.22, the S&P 500 lost 1 point to 1,314.70 and the Nasdaq declined 2.5 points to 2,541.15.
Monday US markets ended in the green with the Dow up 1.09%, the S&P 500 was 1.60% higher and the NASDAQ ended the session up 2.46%.
Fitch cut Japan's rating to A-plus from AA with a negative outlook, which means a further cut is possible.
Wednesday, eurozone leaders are due to meet in a summit to address the latest problems with European sovereign debt, worries that Greece is moving closer to leaving the eurozone, and the contagion effects an exit might have on other economies.
In corporate news, Apple (NASDAQ:AAPL) has kept its ranking as the world’s most valuable brand, according to a new study by market research agency Millward Brown. IBM (NYSE:IBM) came in second, followed by Google (NASDAQ:GOOG) coming in at third place.
Facebook (NASDAQ:FB) stock may also be in focus as its stock fell 11 percent on its second day as a listed company.
Clothing outlet Urban Outfitters (NASDAQ:URBN) reported a first-quarter profit of $0.23 per share, beating estimates by three cents, though revenues did come up short of consensus.
BlackRock (NYSE:BLK) is part of a group of three investors purchasing a $1.6 billion stake in motor racing group Formula One from CVC Capital. Formula One is currently making plans For a $3 billion initial public offering in Singapore.
On the economic front, the National Association of Realtors releases April existing home sales at 10am EDT. Economists expect a gain of 2.7 percent from March to an annual rate of 4.6 million units.
On the NYMEX, crude futures fell 33 cents to $92.53 a barrel while gold futures fell $12.60 to $1,576.10 an ounce.
European stocks moved higher in morning trading with the FTSE 100 rising 0.9%, the DAX gaining 0.7% and the CAC 40 up by 0.6%.