This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Futures Signal Rebound After Sharp Selloff

Stocks in this article: ^GSPC ^IXIC ^DJI

NEW YORK ( TheStreet) -- U.S. stock futures traded higher after U.S. weekly jobless claims came in better than expected and Italian bond yields edged down, lifting hopes for a rebound from the prior session's sharp selloff.

Futures for the Dow Jones Industrial Average were up 127 points, or 121 points above fair value, at 11,859. Escalating worries about Italy's fiscal fate sent the Dow down 389 points on Wednesday. The index saw its biggest decline in seven weeks as well as its sixth-largest drop in the year.

Futures for the S&P 500 were up 17 points, or 17 points above fair value, at 1243. Futures for the Nasdaq were up 26 points, or 26 above above fair value, at 2337.

The Labor Department's read on jobless claims dropped 10,000 to 390,000 for the week ended Nov. 5 from a revised 400,000 in the previous week. Economists expected claims to inch up to 400,000 according to Thomson Reuters.

The U.S. trade deficit narrowed in September to its lowest level in 2011. The trade gap shrank to $43.1 billion from a revised $44.9 billion in August as exports rose to a record high. Economists expected the gap would widen to $46 billion from the originally reported $45.6 billion in August.

With European stocks rebounding, U.S. stocks were set to follow suit. Yields on 10-year Italian bonds fell to 6.6%, in part due to the European Central Bank which was reportedly buying up bonds in an effort to keep a cap on rising yields. The bank's intervention comes one day after the country's debt soared to euro-era records.

"The focus is on whether or not the plan to contain bond yields is going to work," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "Everybody knows that the problem here is focusing on whether Italy can sustain the debt load that it has. It's a force to be reckoned with."

London's FTSE was rising 0.5%, and Germany's DAX was gaining 1.3%. Overnight, Asian stocks followed the decline in U.S. stocks. Japan's Nikkei Average finished down 2.91% and Hong Kong's Hang Seng plummeted 5.25%.

Greece named an interim prime minister, Lucas Papademos, to take over after the departure of Prime Minister George Papandreou. The announcement comes after weeks of political maneuvering as the country struggles to pass austerity measures needed to secure a bailout package from Europe.

"Greece was small positive but pretty much as was expected," added Pado of Cantor Fitzgerald. "Trading on the Italian bonds will likely remain the big headline of the day."

However, Pado added, "we could easily see swings in the triple digits today... the volatility has gotten so expected that nobody's yelling and screaming or thinking twice about a 400 point decline. We're just going to have to live with these wild swings."

Helping to lift sentiment in the morning were better than expected quarterly results from tech bellwether Cisco (CSCO) . The company was gaining 5.8% after posting earnings of 43 cents per share and reporting revenues that rose 4.7% year-over-year to $11.3 billion despite sluggish corporate spending. Analysts surveyed by Thomson Reuters were looking for earnings of 39 cents a share and revenue of $11.03 billion in the period.

In other corporate news, shares of K-Cup king Green Mountain Coffee Roasters (GMCR) were plunging 32.5% in premarket trading. The company missed fourth quarter revenue expectations by a wide margin, despite growing the top line by more than 90% on a year-over-year basis. Waterbury, Vt.-based Green Mountain's revenue total of $711.9 million for the quarter was more than 6% below the average estimate of analysts polled by Thomson Reuters for revenue of $760.5 million.

Cambridge, Mass-based business software maker Pegasystems (PEGA) was plummeting 15.6% after reporting third-quarter adjusted earnings that were less than half of what Wall Street was looking for. The company posted profit of 15 cents a share on revenue of $95.5 million, up 6% year-over-year, but below forecaste earnings of 31 cents a share on revenue of $111.3 million.

Advance Auto Parts (AAP) reported third-quarter earnings of $1.41, beating the average analyst estimate of $1.18. The company also forecasted full-year earnings of $4.90 to $4.95 a share, above the average analyst estimate of $4.69 a share. Shares were up 0.4% to $66.60.

Gold for December delivery was losing $28 to trade at $1,763.60 an ounce. In other commodities, the December crude oil contract edged up 71 cents to trade at $96.45 a barrel.

The euro was rebounding by 0.18% to $1.347 after dropping about 2% yesterday. The dollar index lost 0.23%. Ten-year U.S. treasury notes were losing 1 18/32, pushing the yield slightly above 2%, after a rush to safety sent yields below 2% on Thursday.

-- Written by Chao Deng in New York.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,356.87 +288.00 1.69%
S&P 500 2,012.89 +40.15 2.04%
NASDAQ 4,644.3120 +96.4780 2.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs