Last checked at LONDON (Alliance News) - US stocks are set to open flat to modestly higher Tuesday, extending the small gains posted on Monday, but with the threat of escalating tensions in Ukraine and a lack of top-tier US macro economic data, equity indices may remain within tight ranges.
US equities overturned early weakness to close slightly higher on Monday on the back of some stronger-than-expected purchasing managers' index data.
The ISM said its non-manufacturing index for the US rose to 55.2 in April from 53.1 in March, coming in ahead of economists' forecasts of 54.1. The Markit services PMI rose to 55.0 in April. This was slightly lower than the 55.3 recorded in March, but came in ahead of economists' expectations of 54.2.
The DJIA closed up 0.1%, the S&P 500 closed up 0.2%, and the NASDAQ Composite closed up 0.3%.
Ahead of the New York bell Tuesday, the three indices are all called to open marginally higher.
However, "as the DJIA and S&P 500 push towards the top of their ranges at 16,600 and 1,900, respectively, stocks are extra vulnerable to flare ups in Ukraine which is turning increasingly violent," says Jasper Lawler, market analyst at CMC Markets. "Any pullbacks should still be limited though as long as Russian troops don't cross the border," he adds.
In the UK, major stock indices continue to trade slightly lower, weighed upon by a number of individual movers. Prior to the Wall Street open, the FTSE 100 is down 0.3% at 6,805.19, the FTSE 250 is down 0.;2% at 15,902.23, and the AIM All-Share index is down 0.4% at 821.63.
Aberdeen Asset Management, down 6.4%, and Barclays, down 4.4%, continue to lead the blue-chip fallers. Aberdeen Asset Management said its pretax profit fell by more than 10% in its first-half compared to a year, while Barclays reported a drop in its first-quarter pretax profits as it was hit by a continued slump in the performance of its investment bank, where income was down by 28%.
Meanwhile, Balfour Beatty is still the biggest loser in the mid-cap index. Shares in the building and engineering firm have come under pressure after it said that its construction business has continued to struggle which will result in "significantly" lower group pretax profit for 2014 than previously expected.
European stocks also are fractionally lower, with the CAC 40 in Paris down 0.2% and the DAX 30 in Frankfurt down 0.4%.
Still to come in the data calendar Tuesday, the US Bureau of Economic Analysis releases its trade balance report for March at 1230 GMT. Economists' expectations are for the trade balance deficit to have narrowed to USD40.3 billion from USD42.3 billion in February.
The US IBD/TIPP economic optimism index reading for May is released at 1400 GMT, followed by a speech from Federal Open Market Committee member Jeremy Stein at 2130 GMT.
In corporate news, "with internet technology stocks still under pressure, results from TripAdvisor and Groupon will be of particular interest," says Lawler.
The companies are among those reporting quarterly earnings results after the Wall Street close Tuesday.
TripAdvisor is expected to report earnings per share of USD0.55, and revenues of USD282.9 million, Lawler says, while Groupon is expected to post a quarterly loss of USD0.03 per share on revenue of USD738.40 million.
By James Kemp; jameskemp@alliancenews.com; @jamespkemp
Copyright 2014 Alliance News Limited. All Rights Reserved.
27 Feb 2024 11:33
IN BRIEF: Faruqui of Barclays named new Takeover Panel head
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