US STOCKS-Wall Street set to open lower on debt deadlock

Wed Jul 27, 2011 9:17am EDT

Related Topics



 * U.S. durable goods orders fall
 * Amazon.com reports surge in revenues
 * Dunkin' Donuts IPO prices at $19 per share
 * Futures off: S&P 4.4 pts, Dow 16 pts, Nasdaq 12.75 pts
 * For up-to-the-minute market news see [STXNEWS/US]
  (Updates with durable goods data, adds quote)
 By Angela Moon
 NEW YORK, July 27 (Reuters) - U.S. stocks were set for a
third straight day of declines as the political deadlock over
raising the debt ceiling and a decline in durable goods orders
kept investors away.
 A Republican plan to cut the U.S. deficit met stiff
opposition, reducing the chances of a late compromise to avoid
a crippling debt default. [ID:nN1E76P2HJ]
 Even if there is no default, the government could face a
downgrade in its triple-A rating, which would raise borrowing
costs and deal a blow to the economic recovery.
[ID:nN1E76P2HJ]
 Credit Suisse strategists see a 50 percent chance of a
credit rating downgrade on U.S. debt, even if the ceiling is
raised as key decisions on fiscal tightening are delayed until
after the 2012 U.S. elections.
 Further pressuring market sentiment, new orders for
long-lasting U.S. manufactured goods fell unexpectedly in June,
and a gauge of business spending plans slipped.
[ID:nN1E76Q0BV]
 "The disappointing data adds to the theme of a slowing
global economy, which has been somewhat forgotten by some with
the markets focus on European and U.S. debt concerns," said
Peter Boockvar, equity strategist at Miller Tabak + Co in New
York.
 S&P 500 futures SPc1 fell 4.4 points and were below fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures DJc1 were down
16 points, and Nasdaq 100 futures NDc1 dipped 12.75 points.
 Dunkin' Brands Group Inc (DNKN.O) has raised $422.75
million after pricing its IPO at $19 per share, well above the
range set by underwriters. [ID:nN1E76P2B5]
 Amazon.com Inc (AMZN.O) reported a surge in quarterly
revenue late Tuesday, but profits slipped as the largest
Internet retailer kept spending on distribution, technology and
digital content. The stock was up 5.5 percent at $226.00 in
premarket trade.
 Boeing Co (BA.N) shares rose 3.3 percent to $72.50 after
the planemaker's quarterly profit shattered expectations on a 6
percent increase in revenue. [ID:nN1E76Q03L]
 Dow Chemical Co (DOW.N) shares were up 2.1 percent at
$36.60 after the company said profit rose about 74 percent.
[ID:nN1E76Q01S]
 WellPoint Inc WLP.N posted better-than-expected profits,
but its shares fell 3.5 percent to $71.00 after the health
insurer warned that costs for its Medicare plans for seniors
were higher. [ID:nN1E76Q01X]
 Financial stocks were in focus after European banks such as
Societe General (SOGN.PA) and Banco Santander (SAN.MC) fell
after a downgrade by Goldman Sachs. The brokerage cut the banks
to "neutral" from "overweight", saying doubts over a Greece
rescue package have started to emerge.
 Gold prices hit another record high at more than $1,623 an
ounce, while the cost of insuring U.S. debt against a default
in the next year hit a new high, according to data monitor
Markit.
 The stalemate in U.S. debt talks dragged down stocks for a
second day on Tuesday, and light volume indicated that
investors were reluctant to make bets despite another round of
healthy earnings.
  (Reporting by Angela Moon; editing by Jeffrey Benkoe)






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