The major U.S. index futures are pointing to a higher opening on Wednesday, with the Irish debt worries and a lackluster housing starts data likely to keep sentiment subdued, in line with recent trend. The Commerce Department reported that housing starts fell by much more than expected in October, suggesting that the housing market is still having difficulty finding the bottom. That said, the bulk of the declines was in the more volatile multi-family category. Meanwhile, commodity prices are continuing to see weakness and the dollar is retreating slightly against the euro. U.S. stocks opened lower and continued to trade in negative territory throughout Tuesday’s session before closing notably lower. The decline came amid the release of mixed economic data, with the dollar’s strength also responsible for some of the weakness. The major averages opened lower and moved sideways in early trading before declining steadily till the afternoon. The major averages went about a consolidation move in the afternoon and closed sharply lower. The Dow Industrials ended down 178.74 points or 1.59% at 11,024 and the Nasdaq Composite Index closed 43.98 points or 1.75% lower at 2,470, while the S&P 500 Index fell 19.41 points or 1.62% to end at 1,178. Twenty-eight of the Dow components closed lower, with Home Depot (HD) and Wal-Mart (WMT) bucking the downtrend with gains of 1.02% and 0.57%, respectively. On the other hand, Alcoa (AA), Cisco Systems (CSCO), General Electric (GE), McDonald’s (MCD), 3M Co. (MMM), Travelers Co. (TRV) and Exxon Mobil (XOM) were among the worst decliners. Among the sector indexes, the Dow Jones Transportation Average fell 1.46%, the NYSE Arca Airline Index slipped 1.49%, the Philadelphia Housing Sector Index dropped 2.01%, the NYSE Arca Securities Broker/Dealer Index moved down 1.64% and the KBW Bank Index dipped 2.01%. In the resource space, the NYSE Arca Oil Index declined 2.46%, the Dow Jones U.S. Basic Materials Average fell 2.40% and the NYSE Arca Gold Bugs Index receded 2.84%. Among technology indexes, the Philadelphia Semiconductor Index moved down 1.45%, the NYSE Arca Disk Drive Index lost 2.39% and the NYSE Arca Software Index receded 2.04%. On the economic front, industrial output remained unchanged in October compared to the previous month, with the status quo level coming about due to a drop in utility output. Manufacturing output climbed 0.5%, led by the auto and durable goods sectors. Business equipment production also remained strong, rising 1.1%. Meanwhile, the Labor Department said producer prices rose a less than expected 0.4% month-over-month in October due to a rise in energy prices, which were up 3.7%. The core producer price index slipped 0.6% compared to expectations for a 0.1% increase. Food prices edged down 0.1%. Crude prices and intermediate good prices were up 1.2% and 4.3%, respectively. The National Association of Home Builders released the results of its monthly builder confidence survey, with the housing market index rising to 16 in November from a downwardly revised reading of 15 in October. The present conditions index remained unchanged at 16 for the second straight month, while the index measuring future sales expectations rose 2 points to 25. The index of prospective buyer traffic rose a point to 12. Currency, Commodity Markets Crude oil futures are edging down $0.51 to $81.83 a barrel after declining $2.52 to $82.34 a barrel in the previous session. Gold futures, which fell $30.10 to $1,338.40 an ounce in the previous session, are currently trading flat. Among currencies, the U.S. dollar is trading at 83.349 yen compared to the 83.2902 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.3504 compared to yesterday’s $1.3489. Asia Most Asian markets declined on Wednesday, led by the Chinese, Indian and Hong Kong, which fell about 2% each. The fluid economic environment and the re-ignition of European debt crisis following the aggravation of the fiscal situation in Ireland led to the weakness. Europe The major European averages have given back some of their early gains and are currently trading on a mixed note. The French CAC 40 Index and the German DAX Index are moving up 0.57% and 0.34%, respectively, while the U.K.’s FTSE 100 Index is receding 0.21%. In economic news, the Bank of England released the minutes of its monetary policy meeting, which showed a three way split. The committee had voted to maintain the bank rate at 0.5% and the size of its quantitative easing at 200 billion pounds. Most members felt that the balance of risks had not altered decisively and so the right action at this meeting was to maintain the current highly expansionary stance of monetary policy. Further, members felt that it would be premature to either tighten or loosen policy further. The number of people claiming jobseeker's allowance, or the claimant count, in the U.K. fell by 3,700 between September and October 2010 to 1.47 million, the U.K. Office for National Statistics said. Economists had forecast an increase of 6,000 following September's revised 1,300 rise. The claimant count rate continued to stay at 4.5% for a fifth straight month. The total number of unemployed people fell by 9,000 to 2.45 million in the three months to September. During the same period, the broad ILO jobless rate was 7.7%. U.S. Economic Reports The Labor Department’s consumer price inflation report showed a 0.2% month-over-month increase in consumer prices for October. The increase was slightly less than what economists had expected. The core consumer price index remained unchanged, while the consensus estimate was for a 0.1% increase. Food prices rose 0.1% in October compared to 0.3% growth in August and energy prices rose a steeper 2.6%, faster than the 0.7% increase witnessed in the previous month. Shelter costs edged up 0.1% after remaining unchanged in the previous two months. Also, the Commerce Department released a report showing that housing starts fell 11.7 percent to an annual rate of 519,000 in October from the revised September estimate of 588,000. Economists had expected starts to slip to an annual rate of 600,000 from the 610,000 originally reported for the previous month. While the Commerce Department also said that building permits rose 0.5 percent to an annual rate of 550,000 in October from the revised September rate of 547,000, economists had expected permits to rise to an annual rate of 570,000. The Energy Information Administration is scheduled to release its weekly petroleum inventory report for the week ended November 12th at 10:30 AM ET. Crude oil stockpiles fell by 3.3 million barrels in the week ended November 5th to 364.9 million barrels. Nevertheless, inventories of crude oil remained above the upper limit of the average range. Gasoline inventories declined by 1.9 million barrels and yet were still above the upper limit of the average range. Distillate stockpiles also fell, dropping by 5 million barrels. Inventories continued to remain above the upper boundary of the average range. Refinery capacity utilization averaged 82.4% over the four weeks ended November 5th compared to 81.8% in the previous week. Earnings Hot Topic (HOTT) reported third quarter earnings of 1 cent per share compared to 13 cents per share in the year-ago quarter. Sales fell 3.4% to $183.2 million. Analysts estimated earnings of 5 cents per share on revenues of $182.12 million. The company also announced cost reduction plans, including the closure of 40 to 50 underperforming stores, the elimination of 14% of the home office and field management positions and a reduction of capital expenditures. Excluding the costs related to the cost reduction plan, the company expects earnings of 11-14 cents per share on a low single-digit decline in comparable store sales. Meanwhile, analysts estimate earnings of 13 cents per share. Sina Corp. (SINA) said its third quarter non-GAAP earnings rose 65% to 50 cents per share. Net revenues rose 12% to $108.2 million. Analysts estimated earnings of 43 cents per share on revenues of $103.21 million. For the fourth quarter, the company expects non-GAAP revenues of $103 million to $106 million, while analysts estimate revenues of $108.65 million. Bob Evans (BOBE) reported second quarter earnings of 26 cents per share, lower than 50 cents per share last year. Sales fell to $417.05 million from the year-ago’s $424.85 million. The consensus estimates called for earnings of 40 cents per on revenues of $421.25 million. The company raised its adjusted operating income guidance for fiscal year 2011 to $108 million to $112 million from its earlier guidance of $105 million to $110 million, while it expects net sales of about $1.7 billion. Target (TGT) said its third quarter earnings rose 28.5% to 74 cents per share and reported total revenues that rose 2.2% to $15.61 billion. Analysts estimated earnings of 68 cents per share on revenues of $15.61 billion. BJ’s Wholesale Club (BJ) reported third quarter net income of 32 cents per share, including 13 cents per share in charges. Net sales rose 4.8% to $2.57 billion. Analysts estimated earnings of 36 cents per share on revenues of $2.64 billion. The company upwardly revised its earnings guidance for 2010 to $2.48-$2.52 from its earlier guidance of $2.40-$2.50 per share, while analysts estimate earnings of $2.45 per share. Chico’s FAS (CHS) reported third quarter earnings of 16 cents compared to 13 cents per share last year. On an adjusted basis, the company reported earnings of 53 cents per share. Net sales climbed 8.1% to $483 million. The consensus estimates called for earnings of 15 cents per share on revenues of $476.57 million. Other Corporate News Urban Outfitters (URBN) may see some activity after it announced that its board has authorized the repurchase of an additional 10 million shares. Northrop Grumman (NOC) could also be in focus after it announced that it has been selected as one of the contractors by NASA for an indefinite delivery, indefinite quantity cost-plus fixed-fee multi-award contract with a five-year period of performance. The company will perform under initial task orders valued at $46 million in support of the ORS Office located at Kirtland Air Force Base.

Source