BLBG: U.S. Stock Futures Are Little Changed Before Syria Vote
U.S. stock futures were little changed, after equities rose to a one-week high, before a Senate committee vote on action against Syria as investors awaited economic data for clues on the Federal Reserve’s next move.
LinkedIn Corp. lost 2.2 percent in early New York trading after saying it will sell shares for about $1 billion. Microsoft Corp. fell as Morgan Stanley lowered its rating of the software maker after its deal to buy Nokia Oyj’s devices unit. Apple Inc. advanced 2.1 percent after Cantor Fitzgerald LP initiated coverage of the shares with a 12-month price estimate that is 59 percent higher than yesterday’s close.
Futures on the Standard & Poor’s 500 Index expiring this month slid 0.1 percent to 1,637.40 at 8:27 a.m. in New York. Contracts on the Dow Jones Industrial Average declined 22 points, or 0.2 percent, to 14,805 today.
“It’s very important for markets what the U.S. is going to do with the Syria situation,” said Kully Samra, who manages U.K. clients for Charles Schwab Corp., which has $2.1 trillion of assets globally. “The Beige Book is the big one among economic reports that investors are waiting for. It’s something the Fed looks at closely and is among the last big reports before the September policy meeting.”
The S&P 500 rose 0.4 percent yesterday, paring gains of as much as 1.1 percent, after Republican House Speaker John Boehner said he supports President Barack Obama’s call for action against Syria.
Use of Force
The Senate Foreign Relations Committee will vote today on a resolution that supports the use of force by the U.S. military in Syria with a 90-day limit and explicitly doesn’t authorize use of ground troops in combat. The Senate Democratic leadership supports the resolution, according to an aide who asked not to be identified.
Fed officials have been scrutinizing data to determine the timing and pace of any reduction in its $85 billion in monthly bond buying. The Fed will publish its Beige Book survey of economic conditions in 12 Fed districts at 2 p.m. Washington time.
Figures due Sept. 6 may show U.S. payrolls increased in August and the jobless rate held at 7.4 percent. A report tomorrow is expected to indicate that companies hired fewer workers in August than in the prior month. A manufacturing gauge published yesterday reached a two-year high.
The central bank, which has said it may pare stimulus if the U.S. economy improves in line with its forecasts, will hold its next policy meeting on Sept. 17-18. The S&P 500 has lost 4.1 percent from a record on Aug. 2 amid speculation the Fed will decide at that meeting to slow its bond buying. The stimulus helped push the benchmark gauge up more than 150 percent from its March 2009 low.
LinkedIn, Microsoft
LinkedIn slid 2.2 percent to $240.65. The owner of the world’s biggest professional-networking website said in a filing it plans to sell 4.17 million shares of its Class A stock. LinkedIn estimated it will raise $1 billion from the sale, based on a closing price of $240.04 on Aug. 30.
Microsoft lost 0.7 percent to $31.67. Morgan Stanley downgraded the world’s biggest software maker to equal weight, a rating comparable to neutral, from overweight, which is similar to buy. The company’s 5.44 billion-euro ($7.2-billion) deal with Nokia brings execution risks and increased expenditure, the brokerage wrote in a note.
H&R Block Inc. tumbled 4.1 percent to $26.75. The largest U.S. tax-returns preparer reported a first-quarter loss excluding one-time items of 40 cents a share, compared with analysts’ average forecast of 38 cents.
Apple Rating
Apple advanced 2.1 percent to $498.75 after Cantor initiated coverage of the iPhone maker with a buy rating and a 12-month price estimate of $777. The target is 59 percent higher than yesterday’s close of $488.58. The world’s biggest technology company announced a Sept. 10 event at which it will unveil new models of the iPhone.
“Apple is on the verge of an extended product cycle that we believe will include a refresh of existing products, increased penetration within existing device categories and entirely new market opportunities,” Cantor analyst Brian White wrote in a note.
J.C. Penney & Co. gained 2.1 percent to $12.99 after Glenview Capital Management LLC raised its stake in the department-store chain. Glenview said in a filing yesterday it owns 20.1 million shares, or 9.1 percent, of J.C. Penney. It had earlier owned 8.4 million shares, according to a June 30 filing.
Ciena Corp. jumped 9.9 percent to $22.72. The company reported third-quarter profit that topped estimates and issued a forecast for fourth-quarter sales that was above analysts’ predictions.
Dollar General Corp. added 4.1 percent to $56.10. The discount retailer said second-quarter adjusted profit off 77 cents per share, ahead of the 74 cents estimated by analysts in a Bloomberg survey.
To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net
To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net
