US stocks futures moved slightly lower across the board Wednesday morning as Wall Street remained cautious ahead of the results of the US government's stress test on major banks, set for release on Thursday.
As of 6:15 am ET, the S&P Futures were down 4 points, the NASDAQ Futures were down 4 points, and the Dow Futures were down 20 points.
Stocks saw some weakness on profit taking Tuesday, as traders cashed in on the standout gains that were posted in the previous session. Nonetheless, the major averages ended the session well off their worst levels of the day.
The Dow closed down 16.09 points or 0.2 percent at 8,410.65, the Nasdaq closed down 9.44 points or 0.5 percent at 1,754.12 and the S&P 500 closed down 3.44 points or 0.4 percent at 903.80.
Trading on Wednesday could be impacted by the release of quarterly results from Disney (DIS), Electronic Arts (ERTS), and Pulte Homes (PHM).
Diversified media and entertainment company Walt Disney Co. (DIS) said Tuesday after the markets closed that its second quarter profit fell 46% from last year, as income at its movie studio and theme parks were severely hurt by the economic downturn. However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations.
Video game publisher Electronic Arts reported a narrower loss for the fourth quarter, helped by lower operating expenses. In addition, the EA confirmed its non-GAAP guidance for fiscal 2010.
Home builder Pulte Homes Inc. reported a narrower net loss for the first quarter, helped by lower charges, and its cost-cutting measures. In addition, the company said that excellent buying conditions, combined with sharply reduced new home inventory levels will provide the setting for an eventual housing recovery.
Additionally, the release of Automatic Data Processing's (ADP) report on private sector employment in the month of April could shed some light on the strength of the Labor Department's monthly employment report.
Nonetheless, trading activity may be somewhat subdued ahead of the release of the results of the government's stress tests of the nation's largest financial firms on Thursday.
Rumor has it that 10 of the 19 largest US banks may be forced to boost their capital. Reports out this morning suggested that Bank of America (BAC) needs $34 billion in new capital.
Automaker General Motors Corp. said Tuesday that it might offer current shareholders a reverse stock split that would give them one share of new stock for every 100 shares that they currently own. In a filing with the U.S. Securities and Exchange Commission, GM expects the reverse stock split to be part of a proposed deal with the U.S. Treasury Department to exchange at least half of the company's outstanding debt to the Treasury for the company's common stock.
Asian stocks continued to gain ground on Wednesday, but Japanese markets remained closed. European shares were very slightly positive in early dealing.
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