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Pre-Market: Google I/O Conference Kicks Off; US GDP Contracts in First Quarter


US Commerce Department allows for first oil exports in nearly four decades.

Stock futures pointed toward a mixed open on Wednesday. Before the opening bell, Dow Jones (INDEXDJX:.DJI) futures fell 0.05% to 16,744. Nasdaq (INDEXNASDAQ:.IXIC) futures moved lower, falling 0.05% to 3,792.75. Futures on the S&P 500 (INDEXSP:.INX) were up 0.02% to 1,943.50.


Google (NASDAQ:GOOG) kicks off its annual I/O conference today, where it's expected to preview the latest version of its Android operating system and introduce Android TV, which would compete with set-top streaming-TV products from Apple (NASDAQ:AAPL) and Amazon (NASDAQ:AMZN). Android TV will feature movies, television shows, and games, and will be controllable using Android-powered smartphones or tablets. Google will also reveal more details about Android Wear, including which companies it's partnering with to make its upcoming smartwatches. Motorola, LG (NYSE:LPL), and Samsung (OTCMKTS:SSNLF) have been confirmed to have Android-powered smartwatches in development. Shares of Google rose 0.43% in pre-market trading.

(Also see: Google I/O 2014: Five Things We're Expecting)

Agriculture products giant Monsanto (NYSE:MON) reports earnings alongside today's opening bell, with Wall Street expecting a lower EPS of $1.55 and year-on-year sales growth of 3% and revenue of $4.4 billion. Last quarter, the world's largest seed company reported stronger than-expected earnings as hearty corn sales bolstered the bottom line. Monsanto recently held preliminary talks with Swiss crop chemical maker Syngenta (NYSE:SYT) over a reported $40 billion takeover bid, which would ultimately allow Monsanto to benefit from lower Swiss holding taxes. Shares of Monsanto were down 0.36% in pre-market trading.

Amazon delivery drones may never take flight after documents published by the Federal Aviation Administration earlier this week said that delivering packages via drones for a fee will remain illegal -- at least for now. This continues an established ban on commercial operation drones that's been in place since at least 2007. The FAA has set a September 15, 2015 deadline for safely integrating drones into US airspace regulation, but industry experts don't see the FAA accomplishing this that soon. Amazon was down 0.05% ahead of the open.

Taiwan's Foxconn Technology Group (OTCMKTS:HNHPF), which manufactures consumer electronic devices for companies including Apple, Amazon, Sony (NYSE:SNE), Microsoft (NASDAQ:MSFT), BlackBerry (NASDAQ:BBRY), and others, has been troubled recently with slowing sales, leading shareholders to push for more communication from the company. Chairman and CEO Terry Gou has responded, asking shareholders to be patient and give him more time to establish new business in the electronic car and cloud computing industries.

The US Commerce Department has made two unannounced rulings that will allow for the first US oil exports in nearly four decades. Both Pioneer Natural Resources (NYSE:PXD) and Enterprise Products Partners LP (NYSE:EPD) have separately won the right to ship an ultra-light oil product known as condensate to foreign buyers. Shipments could begin as early as August, but it is not clear how much condensate they will be allowed to ship. For now, the rulings only apply to these two companies. Pioneer rose 2.65% ahead of the opening bell. Enterprise was up 1.51%. 


US first-quarter GDP was revised down to an annualized reading of -1% from an advanced estimate of +1%. This is compared to a 2.6% rise in the fourth quarter of 2013. Analysts had expected a downward revision of only 0.5%, and the decline marks the first since a 0.7% decline in the third quarter of 2011. Durable goods orders in May decreased by $2.4 billion, or 1%, to $238 billion. The decrease follows three consecutive monthly increases, and a 0.8% increase in April. Corporate profits declined $198.3 billion in the first quarter following a $47.1 billion increase in Q4 2013. MBA mortgage applications were little changed with a 1% decline following two volatile weeks in the first half of June. Markit will report its Purchasing Managers Index US Services Flash at 9:45 a.m. The EIA will release petroleum inventories at 10:30 a.m. At 1:00 p.m., the results of the $13 billion two-year FRN auction and the $35 billion five-year note auction will be revealed.

Global Markets

Continued violence in the Middle East stayed Asian investors, who moved out of riskier assets overnight. In China, officials have suggested doubling the size of the proposed Asian Infrastructure Investment Bank to $100 billion, which is slated to be Asia's own version of the World Bank. The AIIB would initially be focused on reestablishing a new version of the "Silk Road" -- aka a transcontinental trade network -- and has already garnered the interest of 22 nations on the continent. In Europe, stocks declined for fourth day -- the longest sustained decline in seven weeks. With continued violence in Ukraine, US President Barack Obama announced he was ready to step up sanctions from select Russian individuals to be applied to Russian industries in an effort to weaken parts of the Russian economy. 

Twitter: @brokawbrokaw
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