Bloomberg News

U.S. Stock-Index Futures Gain as Building Permits Jump

August 16, 2012

U.S. stock-index futures advanced, indicating the Standard & Poor’s 500 Index will rise for a second day, as data showed building permits jumped to the highest level in four years during July.

Cisco Systems Inc. (CSCO:US) and NetApp Inc. rose at least 2.1 after earnings beat analysts’ estimates. Facebook Inc. (FB:US) dropped 2.5 percent as 271.1 million of its shares will be allowed to trade. Wal-Mart Stores Inc. (WMT:US) fell 2.4 percent after posting second- quarter sales that trailed analysts’ estimates.

S&P 500 futures expiring in September rose 0.2 percent to 1,405.8 at 8:56 a.m. in New York. Dow Jones Industrial Average futures added 23 points, or 0.2 percent, to 13,158.

“Another day where markets are mostly range-bound appears likely, although today’s data might just provide the necessary catalyst to finally stage a breakout,” said Markus Huber, head of German sales trading at ETX Capital in London.

New-home construction in the U.S. fell 1.1 percent to a 746,000 annual rate from June’s 754,000 pace, Commerce Department figures showed today in Washington. The median estimate of 79 economists surveyed by Bloomberg News called for 756,000. Building permits, a proxy for future construction, rose to an 812,000 pace, the most since August 2008.

Jobless claims climbed by 2,000 to 366,000 in the week ended Aug. 11, Labor Department figures showed. The median forecast of 45 economists surveyed by Bloomberg News called for an increase to 365,000. The four-week moving average, a less volatile measure, dropped to 363,750, the fewest since the week ended March 31.

The Federal Reserve Bank of Philadelphia will say that manufacturing in its region shrank for a fourth month, economists forecast ahead of a report today. The bank’s index improved to minus 5 in August from minus 12.9 in July, according to the Bloomberg survey median. Figures less than zero indicate contraction.

Volume, Volatility

The S&P 500 added 0.1 percent yesterday as investors weighed manufacturing data for clues on whether the Federal Reserve will move to stimulate the economy. The index has fluctuated around 1,400 for the past seven trading sessions, with intraday price movement averaging 0.6 percent, the smallest fluctuation over a comparable period since January 2011, according to data compiled by Bloomberg.

Trading volume and volatility have dropped as vacationing traders awaited policy clues from the Fed’s summit at the end of the month and the European Central Bank meeting in September. The index has rallied 10 percent from a five-month low on June 1 amid speculation global central banks will introduce further stimulus measures.

Cisco, NetApp

Cisco gained 7.4 percent to $18.64. The biggest maker of computer-networking equipment reported quarterly profit and sales that topped analysts’ estimates as job cuts kept costs in check and price reductions attracted customers.

Profit excluding some costs was 47 cents a share in the period ended July 28, Cisco said. That compared with the average estimate of 46 cents, according to data compiled by Bloomberg. Revenue rose 4.4 percent to $11.7 billion, compared with analysts’ prediction for $11.6 billion.

NetApp climbed 2.1 percent to $32.40. The maker of data- storage products earned 42 cents a share excluding some items in the fiscal first quarter. That beat the average analyst estimate by 10 percent, the most in more than a year, according to data compiled by Bloomberg.

Electronic Arts Inc. (EA:US) surged 10 percent to $14.40. The second-largest U.S. video-game maker is exploring a sale of the company and has been approached by private equity firms such as KKR & Co. and Providence Equity Partners Inc., the New York Post reported, citing people familiar with the situation.

Facebook Shares

Facebook fell 2.5 percent to $20.67. The world’s largest social network frees up 271.1 million of its shares today, boosting by 60 percent the number that could be traded and adding to concerns that have weighed on the stock since the company’s initial public offering.

Early Facebook investors such as DST Global Ltd., Goldman Sachs Group Inc., Elevation Partners and Accel Partners get a green light today to start selling part of their holdings, Menlo Park, California-based Facebook has said in filings.

Wal-Mart fell 2.4 percent to $72.67. The world’s largest retailer reported a 4.5 percent increase in total second-quarter revenue. to $114.3 billion. That trailed analysts’ $115.8 billion average estimate. Net income rose to $4.02 billion, or $1.18 a share, from $3.8 billion, or $1.09, a year earlier. The average of 26 analysts’ estimates compiled by Bloomberg was $1.17 a share.

Agilent Technologies Inc. (A:US) tumbled 6.1 percent to $38. The maker of scientific-testing equipment cut its full-year forecasts, citing slowing economic growth and delays in order deliveries from customers. Profit for the current fiscal year will be no more than $3.08 a share, Agilent said. Analysts, on average, estimated $3.23.

Applied Materials Inc. (AMAT:US) declined 3.8 percent to $11.35. The world’s largest producer of chipmaking equipment forecast fiscal fourth-quarter sales that may fall short of analysts’ estimates as some customers rein in expansion plans. Sales in the current period will fall 25 percent to 40 percent from the prior quarter, the company said, indicating revenue of $1.41 billion to $1.76 billion. Analysts on average estimated sales of $1.95 billion, according to data compiled by Bloomberg.

To contact the reporters on this story: Tom Stoukas in Athens at astoukas@bloomberg.net; Lu Wang in New York at lwang8@bloomberg.net

To contact the editor responsible for this story: Lynn Thomasson at lthomasson@bloomberg.net


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Companies Mentioned

  • CSCO
    (Cisco Systems Inc)
    • $27.38 USD
    • 0.10
    • 0.37%
  • FB
    (Facebook Inc)
    • $77.55 USD
    • 1.92
    • 2.48%
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