Stocks in New York were bracing for a decline at the open for both blue chips and tech shares amid persisting worries about the price of energy.
futures were losing 9 points to 1354 and were nearly 8 points below fair value. Futures on the Nasdaq 100 were sinking 18 points at 1970 and were roughly 11 points under fair value.
Last time out, stocks managed a mixed close as rising energy shares mitigated broader pain, but breadth remained solidly negative, nonetheless. At the end of the day, the
Dow Jones Industrial Average
climbed 71 points to 12,280, and the S&P 500- added a point to 1362. The
lost 15 points to 2459.
As the new day began, traders were dealing with remarks from
chairman Ben Bernanke, who took a more hawkish view on inflation during a speech.
The Fed chief said the jump in oil prices "has added to the upside risks for inflation and inflation expectations," even as his expectations for a "substantial downturn" have simultaneously diminished. He added that the Fed "will strongly resist an erosion of longer-term inflation expectations, as an unanchoring of those expectations would be destabilizing for growth as well as for inflation."
That would appear, once again, to suggest that the Fed won't cut interest rates again following its 325-point easing campaign over the past few months. Some experts have even projected that the Fed could even hike rates in the not-too-distant future amid the inflationary worries.
Crude oil was little changed lately, adding 25 cents to $134.60 a barrel. Gold futures were off $9 to $889.10 an ounce. The U.S. dollar tacked on 0.8% against the euro and firmed by 0.7% against the yen.
On the corporate side, chipmaker
narrowed its second-quarter outlook, partially citing weak demand for handheld devices.
Elsewhere, both Citigroup and Lehman Brothers bumped up their
price targets a day after the company released its 3G-enabled iPhone.
In economic data, the sole report due out is the Census Bureau's April report on the U.S. trade deficit. The figures are set for release at 8:30 a.m. EDT.
Treasury prices were falling. The 10-year note was down 10/32 in price to yield 4.04%, and the 30-year bond shed 8/32 in price, yielding 4.65%.
Foreign markets were uniformly lower. The Nikkei 225 in Tokyo dropped 1.1% overnight, and the Hang Seng Index in Hong Kong plunged 4.2%. As for Europe, Germany's Xetra Dax and the Paris Cac were both losing 0.6%. The FTSE 100 in London was down 0.4%.