Pre-Market Primer: Greece Talks Collapse; Japan Feels the Pain From China Boycotts

By Vincent Trivett  NOV 21, 2012 8:44 AM

Jobless claims in the US are still sky-high because of Hurricane Sandy.


MINYANVILLE ORIGINAL Stock futures were flat this morning as eurozone talks fell apart and US jobless claims remain elevated.

Jobless claims in the United States declined to 410,000 last week after shooting up to 439,000 (which was upwardly revised to 451,000) the week before.

Greece's lenders concluded 11 hours of talks without reaching an agreement over the latest tranche of aid to the Mediterranean country. The European Central Bank, International Monetary Fund, and eurozone finance ministers were supposed to disburse 31.5 billion euros to the cash-strapped country, as it has held up its end of the bargain with tough austerity measures and unpopular labor market reforms.

The deadlock came about because the eurozone countries couldn't accept losses on Greek loans and the IMF refused to allow additional financing or force private bondholders to take a haircut.

The Eurogroup will meet again on Nov. 26 to continue talks.

Japan reported its worst trade deficit in three decades. Exports fell 6.5% and imports fell 1.6% in October, bringing the country's trade deficit to 549 billion yen ($6.7 billion). Partly to blame for the drop was the diplomatic row with China. Exports to China were down 11.6%, auto exports fell 82%. Tensions flared in September when Japan  sought to assert its claim over the Diaoyu/Senkaku Islands. In anti-Japanese protests that broke out in China, owners of Japanese cars were attacked, leading would-be buyers to rethink their plan to purchase a Toyota (NYSE:TM).

Stock futures are dead flat ahead of the opening bell. Dow (INDEXDJX:.DJI) futures stayed put at 12,759.00. S&P 500 (INDEXSP:.INX) futures also flatlined at 1,386.30, and Nasdaq (INDEXNASDAQ:.IXIC) futures rose by 0.09% to 2,595.75.

Consumer sentiment fell slightly this month, according to economists. The Reuters/University of Michigan consumer sentiment index, which will come out later this morning, is expected to fall to 84.0 from 84.9.

Yesterday, when Hewlett-Packard (NYSE:HPQ) reported earnings, it took an $8.8 billion write-down on Autonomy Corp, a software company that it bought last year. HP alleged that Autonomy's executives lied about their company's financials. Thus, more than $5 billion of the charge was due to correcting accounting errors. The Federal Bureau of Investigation and the Securities and Exchange Commission are investigating HP's claims.

Earnings for Deere (NYSE:DE), the world's largest agricultural equipment maker, rose 2.7% in the company's fiscal fourth quarter to $687.6 million and revenue rose 14% to $9.87 billion. Though revenue beat analyst projections, earnings fell short. Deere shares are currently down more than 2%.

Twitter: @vincent_trivett
No positions in stocks mentioned.

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