US stocks could suffer losses on the first day of the year as investors process disappointing manufacturing data from China and Europe.
Futures contracts on the Dow Jones Industrial Average
(INDEXDJX:.DJI) fell 0.13% to 16,472.00 before the opening bell. S&P 500
(INDEXSP:.INX) futures fell 0.16% to 1,838.10. The index rose 31.8% in 2013, ending the year at an all-time high for the first time since 1999. Nasdaq
(INDEXNASDAQ:.IXIC) futures dropped 0.16% to 3,575.25. Gold prices rose 1.15% to $1,216.10
Today, Markit will publish multiple countries’ manufacturing PMIs, an accurate leading indicator of GDP growth. China’s manufacturing growth slowed in December to 50.5 from 50.8 in November. (Readings over 50 indicate growth in the sector.) The eurozone as a whole rose to 52.7 from 51.6, as expected. Germany rose to 54.3 from 52,7, but France worsened to 47 from 48.4.
US manufacturing PMI will be released later this morning. Experts expect a reading of 54.5, a slight monthly decline. The Institute for Supply Management’s manufacturing index is also expected to show a slight decline in December to 57 from 57.3. November US construction spending will also come out. The consensus estimate is for a 1% month-over-month rise after a 0.8% increase in October.
Initial claims for unemployment insurance fell by 2,000 to 339,000 last week. Economists had expected initial claims to rise by 1,000. The four-week moving average rose to 357,250 from 348,750.
Shares of Apple
(NASDAQ:AAPL) fell more than 1% in pre-market trading after Wells Fargo
(NYSE:WFC) analysts downgraded the world’s most valued company to Market Perform from Outperform. The analysts say that Apple could see margins decline this year.
"While we still have conviction in the gross margin thesis (and the potential for iPad/iPhone unit upside), we believe this may be largely embedded into the valuation," wrote analyst Maynard Um. He also expressed concern that carriers might pull the plug on subsidies that make iPhones affordable.
Teva Pharmaceutical Industries
(NYSE:TEVA) reportedly named Erez Vigodman, a turnaround expert, as CEO. The world’s largest maker of generic drugs has been searching for a CEO since Jeremy Levin stepped down in October. Teva has not yet confirmed the appointment.
(NASDAQ:XLNX), a California chipmaker, was bumped to Buy from Neutral by Goldman Sachs
(NYSE:GS) analysts. The stock rose 2.2% on the news, building on a 30% rally in 2013.
No positions in stocks mentioned.
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