* DuPont posts drop in profit, Verizon impacted by Sandy
* J&J, Google and TI all on tap to report on Tuesday
* Obama begins second term, outlines aggressive agenda
* U.S. shares of RIM surge in premarket after CEO comments
* Futures: Dow down 8 pts, S&P up 0.3 pt, Nasdaq up 5 pts
By Ryan Vlastelica
NEW YORK, Jan 22 U.S. stock index futures were
flat on Tuesday as investors held back from making large bets
ahead of an onslaught of corporate earnings and after recently
notching five-year highs.
Both the Dow and S&P 500 closed at their highest levels the
earnings season. U.S. markets were closed on Monday for a public
Despite stronger-than-expected earnings results from major
companies, including big banks, at the start of the quarterly
reporting season, many investors are worried that other reports
will reflect economic uncertainty in the fourth quarter.
"The market has been pleased with earnings thus far, and it
is encouraging to see a cyclical company like DuPont show
revenue strength, but I'm waiting on more tech and energy
earnings until I come down one way or the other on this season,"
said Adam Sarhan, chief executive of Sarhan Capital in New York.
DuPont posted a steep drop in earnings on reduced
demand for paint pigment, though revenue was ahead of
Verizon Communications Inc fell 1.1 percent to $42.06
in premarket trading after reporting a steep loss due to pension
liabilities and charges related to superstorm Sandy that offset
strength in its wireless business. Travelers Cos Inc
also posted earnings that were hurt by losses related to Sandy.
DuPont, Verizon and Travelers are all Dow components, as is
Johnson & Johnson, slated to report later Tuesday along
with Google Inc and Texas Instruments. Tech
earnings will be in particular focus after Intel Corp
last week gave a revenue outlook that was below expectations.
Overall, S&P 500 fourth-quarter earnings are forecast to
have risen 2.5 percent, according to Thomson Reuters data. That
estimate is above the 1.9 percent forecast from a week ago but
well below the 9.9 percent fourth-quarter earnings forecast from
Oct. 1, the data showed.
S&P 500 futures rose 0.3 point but remained 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 8
points and Nasdaq 100 futures rose 5 points.
Monday was a market holiday for Martin Luther King Day in
the United States, and also marked the start of a second term
for President Barack Obama, who called for aggressive action on
climate change, economic equality and the federal budget.
"It remains a question whether Obama will be able to deliver
on his agenda, but a sector like solar power companies could
continue to be strong as he pushes for action," Sarhan said.
Markets have recently been pressured by uncertainty stemming
from Washington about the federal debt limit and spending cuts
that could hamper U.S. growth.
Republican leaders in the House of Representatives said they
aim to pass on Wednesday a nearly four-month extension of the
U.S. debt limit, allowing the government to borrow enough to
meet its obligations during that period.
U.S. shares of Research in Motion jumped
8.9 percent to $17.25 in premarket trading after its chief
executive said the company may consider strategic alliances with
other companies after the launch of devices powered by RIM's new
BlackBerry 10 operating system.
The Dow and S&P 500 closed at five-year highs on Friday as
the market registered a third straight week of gains on a solid
start to the quarterly earnings season, including from Morgan
Stanley and General Electric Co.