* Equity cash markets closed due to storm
* Revenues from U.S. companies disappoint
* Traders eye political risks in Europe
* Futures down: Dow 69 pts, S&P 4.9 pts, Nasdaq 15.75 pts
By Edward Krudy
NEW YORK, Oct 29 U.S. stock index futures fell
in a shortened session on Monday and cash equity trading was
canceled as powerful Hurricane Sandy bore down on the U.S. East
Coast, closing equity trading for Tuesday.
Monday's shutdown was the stock market's first
weather-related closure in 27 years.
U.S. stock markets will remain closed on Tuesday, the
operator of the New York Stock Exchange said, depending on the
damage from the huge and dangerous storm on financial center New
York City overnight and on Tuesday.
Index futures stopped trading electronically at 9:15 a.m.
(1315 GMT), but will reopen at 7 p.m ET for the overnight
session during European and Asian hours, closing again at 9:15
a.m. Tuesday morning.
NYSE Euronext and Nasdaq OMX Group said
they made their decision in consultation with industry
executives and regulators, and intend to reopen Wednesday,
"It doesn't make sense to put people in harm's way or to
only have half a market," said Nicholas Colas, chief market
strategist at ConvergEx Group in New York. "If just the
electronic market was open, that wouldn't provide enough
interest, with everything else still closed."
Sandy, a mammoth storm, took aim at the most densely
populated U.S. Northeast Coast on Monday, forcing hundreds of
thousands to seek higher ground, halting public transport and
closing schools, businesses and government departments.
Italian political turmoil and Spanish hesitancy over
seeking euro-zone assistance put the two countries on the front
line of the region's debt crisis and back under market pressure
on Monday as their leaders met in Madrid.
"We have an illiquid market, we have a risk-off situation
from overseas, and we have some issues going on in the States
with Sandy, so that is impacting things a little more than
expected," said David Lutz, managing director of trading at
Stifel Nicolaus Capital Markets in Baltimore.
S&P 500 futures fell 4.9 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 fell 69
points and Nasdaq 100 futures fell 15.75 points.
Futures closed well off their session lows. S&P 500 futures
fell more than 10 points at the intraday low.
The storm forced the closure of U.S. stock markets on
Monday, the anniversary of the 1929 stock market crash.
Futures did not reopen as usual during the day, including
the popular S&P 500 e-mini contract that lets smaller
traders access index futures.
E-mini contracts typically trade around the clock, closing
for just 45 minutes of each day.
A market closure for more than a day may start causing
problems for investors who need to trade in and out of
positions, investors said.
"If you go two days, you really start to create some serious
financial stress for some players that need to get something
done," said Jim Paulsen, chief investment officer of Wells
Capital Management in Minneapolis. "A two-day closure will
create more stress, and therefore will allow electronic trading.
That's my best guess."
CME Group closed its interest rate operations, including
Treasury, Eurodollar and fed funds futures and options on
futures markets on the trading floor at 12:00 noon on Monday in
line with a closure of the cash market.
In Europe, Spanish and Italian bond yields rose and German
Bund futures hit two-week highs on Monday, partly prompted by
former Italian Prime Minister Silvio Berlusconi's threat to
bring down the Rome government.
Greece's foreign lenders have refused to make any further
concessions on changes to labor laws contested by a junior
coalition partner, the country's finance minister said on
Sunday, prolonging an impasse on a crucial austerity package.
Athens has been locked in talks with its EU and IMF lenders
on the austerity package for months, but a final agreement has
been held up by the small Democratic Left party's refusal to
back the new wage laws.
European shares fell for the first time in four sessions on
Monday, hit by worries over weak company results. The
FTSEurofirst 300 index fell 0.3 percent to close at
1,093.57 points and the euro zone's blue-chip Euro STOXX 50
index fell 0.7 percent to 2,478.84 points.
Canadian ETFs traded in Toronto that hold U.S. equities or
are exposed to U.S. indexes, such as the Horizons S&P 500 Index
C$ Hedged ETF, are available to trade. Some ETFs will
be ineligible for subscriptions or redemptions. Horizons ETF
warned that the bid/ask spread could be abnormally wide.