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Stock Futures Slump on Jobless Claims Data, Wal-Mart

NEW YORK ( TheStreet) -- Stock futures were falling Thursday after a disappointing read on U.S. labor market conditions and quarterly results from Wal-Mart Stores (WMT - Get Report).

Fiscal cliff fears and data indicating that the eurozone fell back into a recession also was weighing on the markets.

Futures for the Dow Jones Industrial Average were falling 40 points, 30.95 points below fair value, at 12,504. Futures for the S&P 500 were down 2.29 points, or 1.78 points below fair value, at 1350. Futures for the Nasdaq were up less than 1 point, or 0.02 points below fair value, at 2530.

"We expect continued volatility with bias toward the downside as markets continue to worry about the resolution of the fiscal cliff," cautioned Mike Simmons, managing director and partner at HighTower. "If Washington can reach a compromise in short order, we could see a nice rally."

The major U.S. stock averages were walloped Wednesday, dragged lower by persistent worries about the fiscal cliff.

The selling accelerated after President Barack Obama again stressed his commitment to ending Bush-era tax cuts for the wealthiest Americans during a press conference. The president's firm stance sets the stage for a tough battle with Republicans toward compromise on the next federal budget.

The Labor Department reported that initial jobless claims for the week ended Nov. 10 rose by 78,000 to 439,000 from the previous week's upwardly revised figure of 361,000. Economists were expecting jobless claims of 375,000.

The four-week moving average was 383,750, an increase of 11,750 from the prior week's 372,000.

Continuing claims for the week ended Nov. 3 increased 171,000 to 3.334 million from the preceding week's upwardly revised level of 3.163 million. Economists were forecasting continuing claims of 3.21 million.

The October consumer price index increased 0.1%, as expected; the core CPI rose 0.2%, more than the estimated 0.1% increase.

The Empire State Manufacturing Survey improved to -5.2 in November from -6.2 the prior month and came in better than the expected fall to -6.7.

At 10 a.m., the Philadelphia Fed's Business Outlook survey is expected to indicate a decline to 2 from 5.7 in October.

The FTSE 100 in London was down by 0.32%, while the DAX in Germany was off 0.5% on Thursday. Japan's Nikkei average finished higher by 1.9% as contractors and exporters got a boost from support coming from Japan's main opposition leader, Shinzo Abe, for public spending and more monetary easing.

Hong Kong's Hang Seng slid by 1.55%.

Gold for December delivery was down $6.10 at $1,724 an ounce at the Comex division of the New York Mercantile Exchange, while December crude oil contracts were falling 11 cents at $86.64.

The benchmark 10-year Treasury was down 6/32, lifting the yield to 1.615%. The dollar was up 0.08%, according to the U.S. dollar index .

In corporate news, BP (BP) said Thursday it is in

advanced talks with the U.S. Department of Justice and the Securities and Exchange Commission about settling criminal and other claims from the Deepwater Horizon explosion in 2010.

Wal-Mart Stores, the world's largest retailer, reported better-than-expected third-quarter earnings, though revenue fell short of the consensus estimate and the company trimmed its full-year profit outlook and gave disappointing current-quarter guidance.

Earnings came in at $1.08 a share on revenue of $113.9 billion as Wal-Mart's sales at stores opened at least a year rose less than expected, though the company has managed to re-attract customers through an emphasis on its low prices. On average, analysts were expecting earnings of $1.07 a share on revenue of $115 billion.

Shares were slumping by more than 3% in premarket trading Thursday.

Target (TGT - Get Report) reported third-quarter earnings that beat estimates by 12 cents as the retailer provided an upbeat outlook on the holiday shopping season.

Revenue rose less than expected as sales growth slowed at stores open at least a year.

Shares were rising 0.77%.

PC maker Dell (DELL) is expected by analysts Thursday to post a third-quarter profit of 40 cents a share on revenue of $13.89 billion. Dell reports after the closing bell.

Shares were down 0.31%.

NetApp (NTAP), the maker of storage and data management software, delivered a solid beat in its fiscal second quarter on Wednesday and also provided a robust outlook.

Shares were surging more than 11%.

Texas Instruments (TXN) announced Wednesday fresh restructuring plans that call for the elimination of 1,700 jobs, or roughly 5% of its work force. The company anticipates charges totaling $325 million in connection with the restructuring program.

Texas Instruments is targeting annual savings of $450 million from the moves.

Starbucks (SBUX) said Wednesday it would pay $620 million in cash to buy Teavana (TEA), which sells high-end loose leaf teas in 300 shopping mall locations.

Honeywell (HON) and Rockwell Collins (COL)are set to receive major contracts to supply systems to Boeing (BA)for its updated 737 Max jetliner, two people familiar with the decisions told The Wall Street Journal.

The contracts could be announced as soon as Thursday.

Honeywell shares were up 0.93%.

Diamond Foods (DMND - Get Report) shares were plummeting by more than 22% after the company revealed Wednesday evening that it has restated its financial results for the 2010 and 2011 fiscal years, following its massive accounting scandal, wiping out $56.5 million in earnings.

The company indicated much weaker profit for the first three quarters of 2012.

-- Written by Andrea Tse in New York.

>To contact the writer of this article, click here: Andrea Tse.

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SYM TRADE IT LAST %CHG
DMND $30.61 0.99%
TGT $77.45 0.52%
WMT $64.86 0.65%
AAPL $110.37 -1.75%
FB $88.15 -1.94%

Markets

Chart of I:DJI
DOW 16,374.76 +23.38 0.14%
S&P 500 1,951.13 +2.27 0.12%
NASDAQ 4,733.4970 -16.4820 -0.35%

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