* U.S. jobless claims rise modestly in latest week
* China stocks fall despite Beijing's economic reforms
* GM profit beats on strong U.S. demand, smaller loss in
* Facebook shares surge in premarket following Wed's results
* Futures down: S&P down 6.1 pts; Dow down 58 pts; Nasdaq up
By Angela Moon
NEW YORK, July 25 Wall Street was headed for a
lower open on Thursday, setting up the S&P 500 index for a third
day of declines, as mixed earnings and concerns about China's
economic slowdown weighed on investor sentiment.
Results from General Motors and Dow Chemical were generally
positive on Thursday. But no quarterly profits so far, with the
possible exception of big U.S. banks, have been so spectacular
as to give stocks a major boost.
Heavy equipment maker Caterpillar Inc's gloomy
outlook on Wednesday weighed on the market.
"We have 50 or so S&P 500 companies reporting today. This is
a lot and the results will be mixed," said Sal Arnuk, co-founder
of Themis Trading, a brokerage firm that specializes in stocks.
Growing worries about a hard landing for China's economy
also had U.S. investors nervous. Chinese stocks suffered their
second straight loss on Thursday despite measures from the
government to spur the economy, including help for exports and
railway investment. Data on Wednesday showed manufacturing in
China running at an 11-month low in July.
Investors also booked profits from a recent rally that has
taken the S&P 500 up 18 percent for the year. Despite a
back-to-back decline in the past two days, the index is still
near its all-time high.
In yet another heavy day of earnings, General Motors Co
posted a stronger-than-expected quarterly profit on
demand in North America and cost-cutting in its struggling
European business. The stock rose 1.6 percent to $37.75 in
Dow Chemical Co's adjusted quarterly profit jumped
16 percent, topping analysts' estimates, driven by robust demand
for pesticides. The stock was up 1.1 percent at $34.75 in
Shares of Facebook jumped nearly 25 percent in
premarket trade to $33.02, a day after the company announced
But not-so-stellar results from bellwethers like
Caterpillar and AT&T on Wednesday triggered concerns about
the profit outlook. Caterpillar shares were down nearly 1.2
percent at $82.41 and AT&T fell 0.3 percent at $35.30 in
S&P 500 futures fell 6.1 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 58
points, while Nasdaq 100 futures gained 4 points.
Data showed the number of Americans filing new claims for
jobless benefits rose slightly last week in a sign the U.S.
labor market continues to improve at a moderate pace while new
orders for durable goods rose by 4.2 percent in June. Market
reaction was muted.
European shares extended losses around midday on Thursday,
as mixed earnings and lingering concerns about the pace of
growth in China triggered a bout of profit taking following
recent sharp gains.