Wall Street set to open lower; retail earnings in focus
U.S. stock indexes were set to open slightly lower on Tuesday as investors awaited results from big retail names to conclude a largely positive earnings season that helped power a recent record rally.
The Dow edged up to its ninth record closing high in a row on Monday, the longest such streak since February.
"New record highs were registered last week as the flow of earnings continued positive with major corporations offering positive guidance going forward," said Peter Cardillo, chief market economist at First Standard Financial.
"Nevertheless, now that the winding down of the second-quarter season has begun, the remainder of August is likely to encounter increasingly sluggish volume, with the indices staying mostly range bound."
Trading volume is also expected to be relatively tepid with summer setting in and with the U.S. Congress on vacation.
The S&P hasn`t had a move of more than 0.5 percent since the end of July and has fallen more than 1 percent only twice this year.
Dow e-minis were down 20 points, or 0.09 percent, with 13,495 contracts changing hands at 8:33 a.m. ET (1233 GMT).
S&P 500 e-minis were down 3.5 points, or 0.14 percent, with 93,292 contracts traded.
Nasdaq 100 e-minis were down 10.25 points, or 0.17 percent, on volume of 14,760 contracts.
Second-quarter earnings have been stronger than expected with analysts, on average, expecting S&P 500 earnings to have expanded 12 percent in the quarter, compared with 8 percent at the start of July, according to Thomson Reuters I/B/E/S.
The rally has, however, triggered concerns about stretched valuations.
The S&P, which is up about 11 percent this year, is trading at 18 times expected earnings, compared to its 10-year average of 14, according to Thomson Reuters Datastream.
Retail earnings are likely to be in focus with Amazon.com looming large over the sector. Macy`s, Kohl`s, JC Penney are expected to report results this week, with Wal-Mart, Target due next week.
And on Tuesday, Michael Kors and Ralph Lauren did not disappoint.
Shares of Michael Kors jumped 15.36 percent in premarket trading after the retailer raised its full-year revenue outlook.
Ralph Lauren was up 5.36 percent after the luxury apparel retailer`s quarterly results beat expectations.
Oil prices steadied after news of lower crude supplies from Saudi Arabia offset higher output from other large producers including the United States. [O/R]
Twilio jumped 13.46 percent after the cloud software maker`s raised it full-year revenue forecast.
Avis Budget Group fell 8.06 percent as the car rental company`s second-quarter profit missed expectations and cut its full-year profit view. Rival Hertz Global Holdings was down 1.57 percent.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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