Stock index futures pointed to a weak open this morning following Thursday’s sell-off that had the Dow testing recent lows. Uncertainty has investors nervous again, but rallies often occur as fear rises. While the media will accentuate the negative stories, positive news such as the increase in corporate bond sales and trading activity will likely gain little attention.
As expected, corporate headlines are mostly negative today. The potential nationalization of Citigroup and Bank of America continue to be debated. In earnings, Lowe’s reported a sharp drop in quarterly profits. The home improvement retailer’s earnings fell to 11 cents per share, just below analyst estimates. Sprint Nextel reported a quarterly loss that narrowed from the previous year and was smaller than expected.
The January CPI data didn't contain too many surprises as total CPI was up 0.3%, in line with expectations, while core CPI was up 0.2% versus the consensus estimate that called for a 0.1% increase. CPI is unchanged on a year-over-year basis while the core rate is up 1.7%.
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