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Market Hustle: Stock Futures Turn Lower on Big GDP Disappointment

NEW YORK ( TheStreet) -- Stock futures turned lower Wednesday, as poor weather and a fall in business investment saw tepid economic growth in the first quarter. Disappointing results from Twitter (TWTR) and eBay  (EBAY) also weighed on indices.

  • Futures for the Dow Jones Industrial Average were falling 17.37 below fair value to 16,451.0 while futures for the S&P 500 were off 3.63 below fair value to 1,868.75. Futures for the Nasdaq were shedding 14.49 below fair value to 3,551.0
  • Economic growth for the first quarter was just 0.1% down from 2.6% in the prior period. Rising personal consumption expenditure was partly offset by a fall in exports, private inventory investment, residential fixed investment and government spending. Expectations were for a result of 1.2%.
  • The ADP private payroll report showed a 220,000 gain for April, beating expectations for 200,000 and up from 191,000 in March.
  • The Federal Reserve is expected to announce a further $10 billion cut to its asset purchases at 2 p.m. EDT, though traders have warned not to underestimate the "surprise" element in Fed announcements and their market impact.
  • Russia is in recession, according to the International Monetary Fund, which cut its 2014 economic growth forecast for the nation to 0.2% on Wednesday. Russia has been slapped with several sanctions from the U.S. and E.U. after its involvement in the Ukraine crisis.
  • In international markets, Germany's DAX was falling 0.07% while the FTSE was 0.23% higher. The Hang Seng closed 1.42% lower while the Nikkei gained 0.11%. The Bank of Japan on Wednesday refrained from further stimulus but cut its growth estimate to 1.1% for the fiscal year ending in March 2015. Eurozone inflation rose to 0.7% in April, recovering from a four-year low of 0.5% in March.
  • Stocks expected to see price action Wednesday include General Electric (GE) after French conglomerate Alstom accepted a takeover bid Tuesday for its power-generation and transmission business. The preliminary deal could see GE pay more than $12 billion in cash. Twitter shares were falling 11.78% in premarket trade Wednesday after the company said its first-quarter loss widened to 23 cents a share from 21 cents a share a year earlier. Twitter reported average monthly active users of 255 million at the end of March, falling short of the million monthly users forecast. eBay shares were more than 4% lower in premarket trade after it reported a first-quarter loss of $1.82 a share due to a tax charge late Tuesday. On Wednesday, MetLife (MET) is slated to post first-quarter earnings of $1.40 a share, while Yelp (YELP) is projected to report a loss of 6 cents a share.
  • Pepco (POM) was jumping 18.3% in early New York trading after Exelon (EXC - Get Report) agreed to buy the utility company.
-- By Jane Searle in New York 

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