Intel Pressures Stocks

Elena
09 Dec, 2005
New York City

Asian-Pacific markets closed higher, led by the Nikkei, up 1.5%, despite disappointing GDP revised report. European stocks traded lower at mid-day on lower sales forecast from Intel. Intel''s shares dropped nearly 3% in extended-hours trading after the company released mid-quarter lower-than-expected sales outlook. Merck dropped 3% on news that Merck withheld information about the cardiac side effects of its arthritis drug Vioxx.

U.S. MARKET AVERAGES

U.S. stock futures pointed to a flat or slightly lower Friday opening, with a disappointing forecast from Intel and the prospect of higher energy prices weighing on sentiment.

Intel ((INTC)) shares dropped nearly 3% in extended-hours trading after the company released mid-quarter lower-than-expected sales outlook.

Oil prices pushed further higher, following a sharp advance Thursday with a winter snow storm hitting U.S. Northeast. Light, sweet crude rose to $61 per barrel.

Merck, another blue chip, dropped 3% after The New England Journal of Medicine said Merck withheld information about the cardiac side effects of its arthritis drug Vioxx.

International Business Machines Corp. ((IBM)) is expected to come under the spotlight after UBS cut its rating on the stock to neutral from buy.

Standard & Poor''s 500 futures were down 1.2 points, a touch above their fair value. Dow Jones industrial average futures were down 2 points, and Nasdaq 100 futures were down 1.5 points.

The University of Michigan''s preliminary December consumer sentiment index is due for release at about 9:45 EST and could provide signs of how consumers are holding up through the all-important holiday shopping season.

INTERNATIONAL MARKET NEWS

Asian-Pacific benchmarks finished Friday session higher. The Nikkei recovered from yesterday’s sharp decline and advanced 1.5% to 15,404.05, ignoring disappointing revised GDP report. Regional markets gained with Singapore Straits Times in the lead, up 0.7%, followed by Hong Kong’s Hang Seng, up 0.2%, and Taipei’s Weighted Index rising 0.2%.

European markets were weak at mid-day trading, hurt by late Wall Street losses Thursday and falling chip stocks as Intel lowered its fourth-quarter sales outlook. The German DAX 30 fell 0.4%, the French CAC 40 dropped 0.4%, and London’s FTSE 100 lost 0.3%.

OIL, METALS, CURRENCIES

Crude oil crossed $61 a barrel, reaching a five-week high as cold weather raised worries about increased heating fuels demand. Light sweet crude for January delivery climbed 35 cents to $61.01 a barrel on the Natural gas surged to $15.15 per 1,000 cubic feet. London Brent advanced 30 cents to $58.92.

European gold hit a 25-year high, rising nearly $530 per ounce on robust world demand, inflation concerns and central-bank buying. Gold for February delivery rose $5.10 to $529 per ounce from $527.80. Silver gained 5 cents to $9.04.

The U.S. dollar advanced against major currencies ahead of industry report, expected to show an increase in consumer confidence. The dollar rose to $1.1793 per euro from $1.1817. The dollar bought 120.46 yen, up from 120.33.