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U.S. futures mixed after holiday weekend; Dow sheds 0.2%

Published 07/05/2011, 08:32 AM
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Investing.com – U.S. stock futures pointed to a mixed open on Tuesday, amid concerns over a possible rate hike by China, while markets awaited key data on U.S. factory orders to gauge the strength of the U.S. economic recovery.  

Dow Jones Industrial Average futures pointed to a modest decline of 0.2%, the S&P 500 futures edged 0.1% higher, while Nasdaq 100 futures shed 0.25%.     

A statement by the People's Bank of China Monday stressing that inflation pressures remain high has raised expectations of an imminent rate increase, two local newspapers reported Tuesday, with one saying a hike could come as soon as this weekend.

Meanwhile, pipeline operator Southern Union Company saw shares jump 2.9% in pre-market trade after rival Energy Transfer Equity raised its bid for the company to USD8.9 billion from a previous offer of USD7.9 billion it made on June 16.

Shares in specialty chemicals maker OM Group gained 1.5% after it announced the acquisition of German-based magnetic materials maker Vacuumschmelze GmbH for nearly USD994 million.

Data storage manufacturer SanDisk saw shares climb 2.4% after Deutsche Bank raised its rating on the stock to ‘buy’ from ‘hold’, citing an improved outlook on margins combined with attractive valuation. 

On the downside, packaged food manufacturer General Mills saw shares slump 1.3% after Credit Suisse downgraded the company to ‘neutral’ and cut its target price on the stock by 10% to USD40.

Meanwhile, shares in pharmaceutical company Novartis were in focus following positive late-stage study results for its breast cancer drug Afinitor.

Other stocks in focus included Microsoft, which announced a partnership with China’s largest internet search engine company Baidu to provide English-language search results generated by Bing to Chinese users. 

Across the Atlantic, European stock markets were mixed. The EURO STOXX 50 fell 0.35%, France’s CAC 40 slumped 0.5%, Germany's DAX eased up 0.1%, while Britain's FTSE 100 edged 0.15% higher.        

During the Asian trading session, Hong Kong’s Hang Seng Index dipped 0.1% amid fears of an imminent tightening in Chinese monetary policy, while Japan’s Nikkei 225 index added 0.07%. 

Later in the day, the U.S. was to publish government data on factory orders.

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