SF: U.S. Stock-Index Futures Drop; Adobe Shares Slump in Germany
Sept. 22 (Bloomberg) -- U.S. stock-index futures fell as investors speculated that an 11 percent rally on the Standard & Poor's 500 Index since July may have outpaced the prospects for economic growth.
Adobe Systems Inc. slumped 15 percent after the maker of graphic-design software forecast sales that trailed estimates. PMC-Sierra Inc. lost 4.7 percent as the chipmaker reduced its third-quarter sales estimate below the average analyst forecast. Barrick Gold Corp. and Freeport-McMoRan Copper & Gold Inc. rose as the precious metal climbed to a record.
Futures on the S&P 500 expiring in December fell 0.3 percent to 1,131.4 as of 12:03 p.m. in London. The benchmark gauge fell from a four-month high yesterday after the Federal Reserve said it's willing to ease monetary policy further to spur growth while refrain from expanding its holdings of securities. Dow Jones Industrial Average futures lost 0.3 percent to 10,666 today, while Nasdaq-100 Index futures slid 0.4 percent to 1,977.75.
"They are telling us that the economy doesn't have to get much worse to have more quantitative easing," said Philip Gijsels, head of research at BNP Paribas Fortis Global Markets in Brussels. "It's a ripe environment for some profit taking and this is a logical reaction to an overbought condition."
Stall Recovery
The S&P 500 has surged 11 percent from this year's low on July 2 as concern eased that U.S. unemployment and less spending from indebted European nations would stall the global economic recovery. The gauge has gained 2.2 percent so far this year, leaving it 6.4 percent below its peak for 2010.
President Barack Obama is contending with widespread opposition at home and mostly approval abroad among investors in a global poll reflecting divergent perspectives on the global business climate. More than three-quarters of U.S. investors view Obama as anti-business and are pessimistic about his policies, while a majority outside the U.S. holds a more favorable view, a Bloomberg survey shows.
Adobe tumbled 16 percent to $27.56 in German trading after the company yesterday said fourth-quarter revenue will be $950 million to $1 billion, citing slower demand from back-to-school shoppers and Japanese buyers. Analysts surveyed by Bloomberg had projected sales of $1.03 billion on average for the period, which lasts through November.
Trails Estimate
PMC-Sierra lost 4.1 percent to $7.47. The chipmaker reduced its third-quarter sales forecast, saying it expects $163 million at most. That trails the average analyst estimate of $173.5 million in a Bloomberg survey.
Barrick Gold, the world's largest producer of the metal, increased 1 percent to $47.31 in Germany as gold climbed to a record in London and New York after the Fed's statement triggered a slump in the dollar.
The dollar declined as much as 0.9 percent against the euro today. Silver reached the highest price since March 2008 and platinum hit a four-month high.
Freeport, which is also the world's second-largest copper producer, gained 0.1 percent to $83.09 in Germany as the weaker dollar also bolstered the appeal of base metals including copper, nickel and tin.
