Tech trouble lurks
Intel, Yahoo! reports disappoint some investors, sending Nasdaq futures lower.
July 20, 2005: 6:14 AM EDT
NEW YORK (CNN/Money) - Quarterly reports from Intel and Yahoo! that managed to disappoint investors are poised to hurt stocks -- especially those on the tech-laden Nasdaq -- when markets open Wednesday.
U.S. stock futures were down in early trading, indicating a lower opening for stocks.
Chipmaker Intel (Research) actually topped expected gains in earnings per share by a penny and raised its third quarter sales guidance. But its margins were less than expected, which sent Intel shares 4 percent lower in after-hours trading Tuesday and early trading in Europe Wednesday.
Internet bellwether Yahoo! (Research) hit earnings forecasts but missed revenue targets, sending its shares off 10 percent after-hours and down 9 percent in active European trading.
Investors will also see results Wednesday morning from five Dow components -- embattled automaker General Motors (Research) as well as tobacco company Altria (Research), drugmaker Pfizer (Research), bank JP Morgan Chase (Research) and manufacturer United Technologies (Research).
And at 10 a.m. ET Federal Reserve Chairman Alan Greenspan will give his view of the economy before the House Financial Services Committee in his semi-annual congressional testimony that he will repeat on Thursday.
Tuesday night, President Bush nominated Judge John Roberts as his choice for the Supreme Court. Stock futures posted a brief rise on the news, then quickly fell back.
Political economist Greg Valliere said he doesn't think the nomination will have much impact on investors Wednesday, partly because the first impression is that Roberts faces a smoother confirmation process than some other candidates might have.
"I think the markets would be a little upset if they thought it would be World War III that would drag Congress to a halt but this does not appear to be that kind of scenario," he said. He thinks Roberts will be embraced by business groups.
"If business had serious objections to him, he wouldn't have been nominated," Valliere said.
Oil prices rose ahead of the weekly U.S. fuel inventory reports. The August light crude futures contract for NYMEX gained 38 cents to $57.84 a barrel in electronic trading, while the September contract for Brent crude rose 43 cents to $57.79.
Major markets in Asia closed higher on strong economic readings out of China Wednesday. Major European markets were higher in early trading.
Treasury prices were lower, lifting the yield on the 10-year note to 4.19 percent from the 4.18 percent level late Tuesday. The dollar gained on the euro and was little changed on the yen.
In other corporate news Chevron (Research) raised its bid for Unocal (Research) by $2 a share, bringing it to $17 billion, and the Unocal board recommended the new offer.