RTTNews - Following a strong outing to start the week, stocks are poised to open Tuesday's session lower amid some profit taking following the release of disappointing earnings. The major index futures are currently all in negative territory, with the Dow futures down by 49 points.
In earnings news, Pulte Homes (PHM) reported a second quarter net loss of $0.74 per share, compared to a net loss of $0.63 per share in the same period last year. Analysts had expected the company to report a loss of $0.57 per share for the quarter.
Pulte said total revenues for the quarter fell to $678.58 million from $1.62 billion in the prior year quarter. Analysts had consensus revenue estimate of $647.07 million.
Meanwhile, Centex (CTX) reported first-quarter net earnings of $0.68 per share, compared to a loss of $1.21 per share in the same quarter of last year. Total revenues were $574 million, down 49 percent from $1.13 billion in the year ago quarter.
Pulte and Centex shareholders are expected to vote on a merger between the two companies on August 18th after Pulte offered to buy Centex for $1.3 billion in stock in April. The move would create the largest homebuilder in the U.S.
Traders also delved into quarterly reports from D.R. Horton (DHI), Archer Daniels Midland (ADM) and Tenet Healthcare (THC), which all fell short of expectations on the bottom line.
On the economic front, the Commerce Department released a report showing that personal spending increased by slightly more than expected while personal income fell by more than expected.
The report showed that personal spending rose 0.4 percent in June following a revised 0.1 percent increase in May. Economists had been expecting spending to increase by 0.3 percent compared to the 0.3 percent increase originally reported for the previous month.
At the same time, the Commerce Department said that personal income fell by 1.3 percent in June after increasing by a revised 1.3 percent in the previous month. The decrease compares to economist estimates of a 1.0 percent decline.
Subsequently, the report said that personal saving as a percentage of disposable personal income was 4.6 percent in June compared with 6.2 percent in May.
Traders are also awaiting a report on pending home sales for June from the National Association of Realtors. Economists expect to see a 0.3 percent increase in the index for June after rising 0.1 percent in May. The data is scheduled for release at 10.00 a.m. ET
In other news, PepsiCo (PEP) has reached an agreement to purchase its bottling firms, set to acquire Pepsi Bottling Group (PBG) for $36.50 per share and PepsiAmericas (PAS) for $28.50 per share, bringing the deal to a total of $7.8 billion.
Stocks saw a significant rally on the first trading day of August, fueled by better-than-expected economic data. The Dow closed up by 115 points at 9,287, the Nasdaq climbed by 30.11 points to 2,009, and the S&P 500 rose by 15 points to 1,002.
With the gains, the Nasdaq closed above the 2,000 level for the first time since October, while the S&P 500 closed above the 1,000 level for the first time since November. The Dow also set a nine-month closing high.
Crude oil futures are sliding in early commodities trading, falling by $1.18 to $70.40 a barrel after rising by a substantial margin in the previous session. The price of gold is also retreating, sliding by $0.90 to $956.60 an ounce.
On the currency front, the U.S. dollar is little changed against the major European currencies, sitting at $1.4388 against the euro, while posting a quote of $1.6926 versus the pound. Meanwhile, the buck is falling against the yen and is now valued at 94.71 yen.
In overseas trading, stock markets across the Asia-Pacific region finished Tuesday's trading on a mixed note. Hong Kong's Hang Seng Index posted a loss 0.1 percent, while Japan's benchmark Nikkei 225 Index ended the session higher by 0.2 percent.
The major European markets are pulling back, with the French CAC 40 Index down by 0.7 percent, while the German DAX Index and the U.K.'s FTSE 100 Index are both falling by 1 percent.
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