Stock futures dip on Europe, Japan growth data; Cisco weighs
By Rodrigo Campos | February 15, 2013 12:35 AM EST
Though weakness in Europe has persisted over recent quarters, underwhelming economic growth data from the region and from Japan, which could impact global growth and U.S. corporate profits, may spur profit-taking in U.S. equities.
The French and German economies shrank more than expected in the fourth quarter of 2012, and a 0.6 percent contraction in the euro zone was the steepest for the bloc since the first quarter of 2009.
Japan's GDP shrank 0.1 percent in the fourth quarter, crushing expectations of a modest return to growth and adding weight to the new government's push for radical policy steps to revive growth.
The S&P 500 is up 6.6 percent so far this year, though a dearth of fresh incentives has kept trading thin over the past few sessions.
"We've had a real absence of news in the marketplace and any bit of information that suggests the recovery is not underway is probably being given more significance that it might have," said Rick Meckler, president of investment firm LibertyView Capital Management in Jersey City, New Jersey.
He said that following a mild climb on the S&P 500, traders were "cashing in a little bit."
Shrinking European economies translated to a 5-percent drop in revenue from the region for Cisco Systems, which reported its results Wednesday. The company's shares fell 1.6 percent in premarket trading.
S&P 500 futures fell 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 fell 62 points, and Nasdaq 100 futures lost 11 points.
H.J. Heinz Co
American Airlines and US Airways Group
On the other hand, shares of the world's largest chip gear maker Applied Materials rose Wednesday after the closing bell following a better-than-expected earnings report and outlook.
(Editing by Bernadette Baum)
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