US stock futures slip after recent run-up

[August 04, 2009]  NEW YORK (AP) -- U.S. stock futures are pointing to a lower opening Tuesday as investors around the world pause after a recent runup, hoping for more confirmation that an economic recovery is underway.

The decline in futures comes amid mostly lower overseas markets and after a nearly monthlong rally that catapulted the benchmark Standard & Poor's 500 index past the 1,000 mark on Monday for the first time since November. Some pullback is to be expected following such an impressive advance.

Stock market investors have seen better-than-expected corporate earnings reports and encouraging outlooks this summer, as well as data showing improvements in the manufacturing and housing industries. Such promising signs have driven hopes that the nearly two-year-long recession is coming to an end, pushing stocks up to levels not seen since last fall.

On Tuesday, investors await reports on consumer spending and housing -- the health of which are crucial for an economic recovery.

Ahead of the market's open, Dow Jones industrial average futures fell 53, or 0.6 percent, to 9,195. Standard & Poor's 500 index futures fell 7.00, or 0.7 percent, to 993.70, while Nasdaq 100 index futures fell 11.75, or 0.7 percent, to 1,615.

Economists are expecting consumer spending to be flat in June. Personal incomes are expected to decline. The Commerce Department will release the data at 8:30 a.m. EDT.

Consumer spending is closely watched because it accounts for about 70 percent of total economic activity.

Later Tuesday, the National Association of Realtors will issue a report on pending home sales in June, which analysts expect to rise for a fifth month in a row.

There have been other promising signs of life in the troubled housing industry recently. Home prices in May posted their first monthly increase since the summer of 2006, according to the Standard & Poor's/Case-Shiller index released last week. And home resales have risen for three straight months, increasing 3.6 percent in June.

Among the earnings reports expected Tuesday are homebuilder D.R. Horton, auto finance company GMAC LLC and food maker Kraft Foods Inc.

Bond prices rose in early trading. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.62 percent from 3.64 percent late Monday.

The dollar rose against other major currencies, while gold prices fell.

Oil prices retreated, falling $1.18 to $70.40 a barrel in premarket trading on the New York Mercantile Exchange.

Overseas, Japan's Nikkei stock average rose 0.2 percent, while Hong Kong's Hang Seng index dipped 0.1 percent. In late morning trading, Britain's FTSE 100 fell 0.7 percent, Germany's DAX index fell 0.8 percent, and France's CAC-40 slipped 0.8 percent.

[Associated Press; By SARA LEPRO]

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