Stock futures are in the red as the government shutdown goes into day three with no solution in sight, and jobless claims also rose.
Yesterday's meeting between President Obama and Republicans failed to make any headway. House Speaker John Boehner said yesterday that the president refuses to negotiate fiscal issues with the GOP as long as the government remains shut down.
"Negotiations now would lead to more demands... I have bent over backwards to deal with the Republican party," Obama said. "This time, I think Wall Street should be concerned."
A report today showed that initial jobless claims rose by 1,000 last week to 308,000. Outplacement firm Challenger Grey & Christmas said that mass layoffs fell to 40.289 in September from 50,462 in August.
Tomorrow's much anticipated jobs report may be delayed due to the government shutdown. September non-farm payrolls growth is expected to rise to 184,000 from 169,000.
US index futures declined following yesterday's losses. Before the opening bell, Dow
(INDEXDJX:.DJI) futures were off 0.15% at 15,003 while futures contracts on the S&P 500
(INDEXSP:.INX) sank 0.17% to 1,680.20. Nasdaq
(INDEXNASDAQ:.IXIC) futures fell 0.08% to 3,235.00.
Later today, the ISM US non-manufacturing sector PMI for September will be released. Economists expect it to fall to 57 from 58.6, indicating a slightly slower rate of growth for the sector. August factory orders data will also come out. Orders are expected to show a 0.3% rise.
European stocks are mixed as the eurozone composite PMI unexpectedly rose to 52.2 in September from 52.1 in August. Services PMI came in at the same level. Retail sales in August also rose 0.7% month-over-month, but fell 0.3% from a year ago. Services PMI in Germany unexpectedly fell to 53.7 from 54.4, France rose 0.3 points to 51, and Italy rose to 52.7 from 48.8.
Chinese stocks posted strong gains today after the country posted a six-month high services PMI of 55.4 in September.
In stock news, United Technologies
(NYSE:UTX), a company that supplies military aircraft, declined after saying that it will lay off 5,000 workers temporarily because of the budget impasse in Washington.
(NYSE:BP) shares rose more than 1% after the company won a reprieve from a US appeals court over the 2010 Gulf of Mexico oil spill. The New Orleans court moved to temporarily halt payouts to victims while claims are reassessed. BP has complained that the claims adjuster has been too generous, even awarding businesses that were not actually harmed by the massive oil spill.
As Bill Ackman's short of Herbalife
(NYSE:HLF) has gone belly up -- the multi-level marketer is up more than 50% since he announced his $0 price target -- the hedge fund manager is moving 40% of his short position into long-term put options.
No positions in stocks mentioned.
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