U.S. Stocks Set to Open Lower
10/15/08 - 09:25 AM EDT
Mike Taylor
Updated from 6:52 a.m. EDT
Premarket futures were forecasting a lower open for stocks in New York Wednesday, as traders assessed the government's new plan to support the financial system and took in a heap of earnings statements. Futures for the S&P 500 were down 30 points at 973 and were 29 points below fair value. Nasdaq futures were down 24 points at 1342 and were 32 points short of fair value. On Tuesday, stocks finished with modest losses, as traders digested the Treasury Department's plan to take a $250 billion equity stake in U.S. banks. The government investment is part of the larger $700 billion Troubled Asset Relief Program to provide assistance to struggling financial firms. Ahead of Wednesday's trading, the Federal Reserve said that Pimco, a unit of Allianz (AZ Quote - Cramer on AZ - Stock Picks), would be the custodian of the government's Commercial Paper Funding Facility, which will buy three-month commercial paper to support money markets. As earnings season hit full stride, chipmaker Intel (INTC Quote - Cramer on INTC - Stock Picks) announced a 12% increase in third-quarter profit, but said its future performance was unclear. Financial firms also released quarterly results, many of which illustrated the deleterious impact of the credit crisis. JPMorgan Chase (JPM Quote - Cramer on JPM - Stock Picks) reported third-quarter profit that slid substantially year over year but nonetheless topped analysts' estimates. Similarly, Wells Fargo (WFC Quote - Cramer on WFC - Stock Picks) said its earnings slid 25% year over year, but the bank beat analyst expectations. State Street (STT Quote - Cramer on STT - Stock Picks), on the other hand, reported an increase in third-quarter income. Outside the financials, pharmaceutical concern Abbott Labs (ABT Quote - Cramer on ABT - Stock Picks) said its earnings rose 51% year over year and raised its full-year earnings forecast.
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