(Corrects share price of GE in second-last paragraph by adding
* Microsoft, Google tumble after results miss
* Investors could take profit after record highs on Dow, S&P
* Futures: S&P up 0.1 pts, Dow off 11 pts, Nasdaq off 2 pts
By Leah Schnurr
NEW YORK, July 19 U.S. stock index futures were
mixed on Friday, after the Dow and S&P 500 closed at record
highs a day earlier, in the wake of disappointing results from
tech giants Microsoft and Google.
News out of China helped set a slightly firmer tone after
the country's central bank announced long-awaited interest rate
reforms, scrapping the previous floor on the rates that banks
charge clients for loans. S&P 500 futures inched up and European
shares cut declines.
Shares of Microsoft and Google were lower
in premarket trading after the results of both, announced after
the close of trading Thursday, fell short of expectations.
Microsoft was down 7.2 percent, while Google tumbled 3.2
"It's the first time in this cycle that we've had some
household names that have missed and I think that's important,
especially on a day where we're starting to transition our
entire focus over to earnings," said Art Hogan, managing
director at Lazard Capital Markets in New York.
Also in the tech sector, Advanced Micro Devices
slumped 10.6 percent after the company said gross margins would
fall, even as the chip maker forecast stronger-than-expected
revenue growth in the third quarter.
Analysts expect S&P 500 companies' second-quarter earnings
to have grown 3.5 percent from a year earlier, with revenue up
1.1 percent, according to Thomson Reuters data.
So far, 70.4 percent of companies that have reported results
have surpassed analysts' earnings expectations, while 49.4
percent have beaten revenue estimates.
S&P 500 futures added 0.1 points but 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 slipped 11
points, and Nasdaq 100 futures were off 2 points.
Without fresh economic data on tap, investors may consider
the high-profile earnings disappointments an incentive to lock
in profits, with the Dow and S&P sitting at record closing
highs. The benchmark S&P is up more than 18 percent for the
Investors were taking in the latest round of earnings on
Friday morning. General Electric and Schlumberger
both reported better-than-expected results, sending their shares
higher. GE rose 1.7 percent, while Schlumberger was up 2.8
Intuitive Surgical slid more than 14 percent after
the company cut its 2013 sales forecast and said U.S. regulators
had issued a warning after an inspection of its facilities.
(Editing by Bernadette Baum)