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Pre-Market: US GDP Nearly Stalls; Facebook Will Reveal More About Mobile Ad Network Today


The FOMC meeting comes to a close this afternoon.

Stock futures pointed to a lower open on Wednesday. Before the opening bell, Dow Jones (INDEXDJX:.DJI) futures fell 0.5% to 16,459. Futures on the S&P 500 (INDEXSP:.INX) were down 0.12% to 1,869.60. Nasdaq (INDEXNASDAQ:.IXIC) futures moved lower, falling 0.32% to 3,552.50.


Facebook (NASDAQ:FB) CEO Mark Zuckerberg is expected to reveal more details about the company's mobile ad network at today's F8 developer in conference in San Francisco. Plans for a service that allow Facebook to leverage data collected from its 1.28 billion monthly active users were revealed during last week's earnings call. While Google (NASDAQ:GOOG) and Twitter (NYSE:TWTR) offer competing services, Facebook has the advantage of offering more extensive personal information. Shares of Facebook fell 0.98% in pre-market trading.

French engineering group Alstom (EPA:ALO) said it will study a $17 billion offer from General Electric (NYSE:GE), but is leaving "the door open" for a rival offer from Siemens (NYSE:SI), reports Reuters. Alstom's board is in favor of a GE buyout, explains the New York Times, but the French government, which bailed out Alstom in 2004, is demanding the company review Siemens' offer. Shares of GE were up 0.37% in pre-market trading. Siemens rose 2.52%.

Twitter reported a disappointing outlook after yesterday's closing bell, with projected second-quarter revenue falling below analyst estimates in a range of $270-$280 million. In other earnings news, Royal Dutch Shell (NYSE:RDS.A) saw its first-quarter net profit fall by 44% year-on-year thanks in part to a $2.9 billion write-down of the values of European and Asian refineries. Daimler (OTCMKTS:DDAIF) saw its Q1 earnings grow by 95%, with net profit rising to $1.5 billion on high demand for new models. Shares of Twitter fell 11.38% in pre-market trading. Royal Dutch Shell rose 4.18%.


US GDP barely grew in the first quarter, rising a mere 0.1% as cold winter weather hurt business investment, exports retracted, and inventory growth slowed. Consumer spending on services did rise significantly -- the most in 14 years -- but on the whole the US economy stumbled. Growth in the employment cost index -- a measure of compensation costs -- softened as well. The ADP jobs report showed the US nonfarm private sector gained 220,000 jobs in April. Today's report of new applications to mortgage lenders reported by the Mortgage Bankers Association showed a sudden decline of 4%. At 9:45 a.m., the Chicago purchasing managers index will arrive. The EIA petroleum inventories are released at 10:30 a.m. The Department of Agriculture will release its end-of-the-month index of prices at 3:00 p.m.

The FOMC meeting comes to a close today, with no post-meeting press expected. A policy statement is due at 2:00 p.m. The Fed is widely expected to cut its bond buying by another $10 billion to a pace of $45 billion a month. 

Global Markets

Asian stocks moved lower overnight, with the benchmark MSCI Asia Pacific Index moving in sight of a one-month low. The Bank of Japan kept its inflation forecasts in place, expecting a 1.3% rise in inflation for the fiscal year ending March 2015, and a 1.9% rate for the following year. China reported a lower GDP forecast of 7.4% for 2014, however despite a slowdown, China could still beat the US to become the world's largest economy in 2014 -- if measured by purchasing power parity. In Europe, stocks were little changed ahead of the final day of the FOMC meeting.

Twitter: @brokawbrokaw
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