U.S. Stock Futures Predict Flat Opening

Elena
07 Aug, 2007
New York City

U.S. stock futures traded near the flat line Tuesday, following a strong rally the previous session when the Dow hit a 4-year high of 286 points as investors bought financial stocks that suffered weakness in earlier hours amid worries over credit markets. Traders were cautious in pre-market hours, awaiting a Federal Reserve decision on interest rates and its view on risk after the recent troubles in credit markets.

[R]09:00AM U.S. stock futures indicated a flat start ahead of Fed’s decision.[/R]

U.S. stock futures traded near the flat line Tuesday, following a strong rally the previous session when the Dow hit a 4-year high of 286 points as investors bought financial stocks that suffered weakness in earlier hours amid worries over credit markets. Traders were cautious in pre-market hours, awaiting a Federal Reserve decision on interest rates and its view on risk after the recent troubles in credit markets.

Casino stocks were in the spotlight, with shares of Wynn Resorts ((WYNN)) climbing 9.7% after the casino operator said its Q2 revenue more than doubled due to strength in Las Vegas and a new casino in Macau. Rival Harrah's Entertainment Inc. ((HET)) added 1% in pre-market trading after it posted 85% profit jump in Q2, due to a strong performance in Las Vegas.

Among companies posting disappointing results, Tyco International ((TYC)) reported a $3.55 billion net loss for the third quarter, due to $3.3 billion in charges. Underlying earnings beat expectations of 55 cents a share. Duke Energy ((DUK)) reported a 17% drop in Q2 net profit, but beat estimates.

In economic news, productivity in the total manufacturing sector grew 1.6% in Q2, as output rose 3.5% and hours increased 1.8%. S&P 500 futures slipped 1.3 points at 1,466.40 and Nasdaq 100 futures lost 2.5 points at 1,960.00. Dow industrial futures gave up 9 points.


[R]8:00AM Harrah’s Entertainment Q2 profit jumped 85%.[/R]

Harrah''s Entertainment Inc. ((HET)) posted 85% earnings jump in Q2 to $237.5 million, or $1.25 per share, vs. $128.6 million, or 69 cents per share a year ago, boosted by strong results in Las Vegas and Atlantic City. Quarterly results beat analyst estimates of 98 cents per share.

Las Vegas revenue climbed to $922.5 million from $803.3 million, while Atlantic City revenue increased to $592.6 million from $521 million. The casino operator posted revenue increase of 14% to $2.7 billion from $2.37 billion last year.

However, adjusted results from continuing operations came in below expectations. Income from continuing operations rose to $195.5 million, or $1.03 per share, compared with $128.7 million, or 69 cents per share, a year earlier.