Caution Prevails As Greek Crisis Continues

(RTTNews) - The major U.S. index futures are pointing to a mixed opening on Thursday, with sentiment reflecting nervousness, as the Greek impasse continues. Although the European Central Bank has approved a request by Greece to extend lending through the Emergency Liquidity Assistance, the Greek debt crisis to yet to see a permanent solution, especially as Germany remains opposed to a Greek debt relief. The Greek crisis could continue to remain an overhang.

Meanwhile, jobless claims data showed a bigger than expected decline in claims for the recent reporting week. Earnings from retail giant Wal-Mart have been mixed. Crude oil is seeing a steep pullback ahead of the EIA inventory report and could negatively impact the oil space. Traders may also keep an eye on the results of a regional manufacturing survey due shortly after the markets open.

Overbought fears weighed on the markets on Wednesday, as some lackluster economic data served as a trigger for profit taking even as the FOMC minutes helped stocks claw back some of their losses in the afternoon. The major averages opened lower and moved roughly sideways amid uncertainty surrounding the resolution of the Greek debt crisis and the release of some soft domestic economic data. Following the release of the FOMC minutes, the averages trimmed their losses over the course of the afternoon before closing mixed.

While the tech-heavy Nasdaq inched up 7.10 points or 0.1 percent to 4,906.36, reaching its best closing level since early 2000, the Dow slipped 17.73 points or 0.1 percent to 18,029.85 and the S&P 500 edged down 0.66 points or less than a tenth of a percent to 2,099.68.

Seventeen of the thirty Dow components closed lower, while the remaining thirteen stocks advanced. Exxon Mobil (XOM), Intel (INTC), JP Morgan Chase (JPM) and Chevron (CVX) were among the biggest decliners of the session. On the other hand, Nike (NKE) and Procter & Gamble (PG) rose strongly.

Among the sectors, banking stocks came under selling pressure, while airline, biotechnology, gold and utility stocks gained ground.

On the economic front, the Commerce Department reported that housing starts came in at a seasonally adjusted annual rate of 1.065 million units and building permits came in at 1.053 million units in January, with both coming in softer than expected. Single-family starts were down 6.7 percent month-over-month, while multi-family starts climbed 7.5 percent, reaching the highest level since July.

Meanwhile, the Labor Department reported that producer prices for final demand fell 0.8 month-over-month in January. Annually, wholesale prices were unchanged. Core producer prices were down 0.1 percent month-over-month but were 1.6 percent higher year-over-year. Energy prices tumbled 10.3 percent.

A separate report from the Federal Reserve said industrial production rose 0.2 percent month-over-month, slightly less than expected. The previous month's output was downwardly revised by 0.2 percentage points to show a 0.3 percent drop. Manufacturing output was up 0.2 percent, although motor vehicle/parts output was down 0.6 percent. Mining output fell 1.0 percent, while utilities output jumped 2.3 percent. Currency, Commodity Markets

Crude oil futures are tumbling $2.30 to $50.52 a barrel after sliding $1.39 to $52.14 a barrel on Wednesday. Gold futures, which declined $8.40 to $1,200.20 an ounce in the previous session, are currently jumping $15.50 to $1,215.70 an ounce.

Among currencies, the U.S. dollar is trading at 119.12 yen compared to the 118.79 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1371 compared to yesterday's $1.1397.

Asia

The major Asian markets that remained open for trading closed on a mixed note, with the Japanese market advancing modestly, while the Australian and New Zealand markets retreated.

The Japanese market rose amid risk aversion, which boosted the appeal of the safe haven yen, while the rest of the markets reacted to the mixed close on Wall Street overnight. The Chinese, Hong Kong, Indonesian, Singaporean, South Korean and Taiwanese markets remained closed for the Lunar New Year holidays.

The Nikkei 225 average opened higher and hovered above the unchanged line throughout the session before closing up 65.62 points or 0.36 percent at 18,265.

Export stocks were in favor, while financial, utility, telecom, construction, pharma and real estate also saw some strength.

Meanwhile, Australia's All Ordinaries, which held above the unchanged line till late morning trading, retreated thereafter and remained in negative territory for the rest of the session. The index ended down 8.10 points or 0.14 percent at 5,870.

Real estate, telecom, material and energy stocks came under selling pressure, while consumer discretionary and utility stocks moved to the upside.

On the economic front, Japan's Ministry of Finance showed that the nation's trade deficit widened to 1.18 trillion yen in January from 665.2 billion yen in December. Nevertheless, the deficit was narrower than the 1.68 trillion yen shortfall expected by economists. Exports rose a better than expected 17 percent, while imports fell 9 percent, dragged down by lower petroleum imports.

The Japanese Ministry of Economy, Trade and Industry said its index of all industry activity in Japan eased 0.3 percent month-over-month in December, in line with estimates. The weakness stemmed from soft service sector activity.

Revised estimates released by the Cabinet Office showed that a leading economic indicators index for Japan was upwardly revised to 105.6 in December from the preliminary estimate of 105.2 and the November reading of 103.7.

Europe

After opening lower, European stocks saw some volatility in early trading ahead of the minutes of the European Central Bank's January monetary policy meeting. However, since late morning trading, the averages pared their losses and are currently higher.

The minutes revealed that a majority of policymakers supported the massive stimulus benevolently bestowed by the central bank. This is the first time in its history the central bank has begun to detail what transpired at the rate-setting meeting, thus embarking on a new communication channel. At the January 22nd meeting, the ECB provided record stimulus to help the region's fragile economic recovery.

In corporate news, Switzerland's Nestle reported higher profits and organic sales for 2014. Air France-KLM reported an increase in its profits for the fourth quarter and announced it would either delay or cancel orders for aircraft, citing the challenging economic environment.

France's Schneider also reported modest increases in revenues and profits for the fourth quarter. Helped by strong dollar and investment gains, Dutch insurer also reported higher fourth quarter net earnings.

Meanwhile, Swiss Re reported a decline in its fourth quarter profits amid a revamping of its life and health business. Deutsche Boerse's 2014 profits rose strongly.

U.S. Economic Reports

After reporting increases in first-time claims for U.S. unemployment benefits in the two previous weeks, the Labor Department released a report on Thursday showing that initial jobless claims pulled back by more than expected in the week ended February 14th.

The report said initial jobless claims fell to 283,000, a decrease of 21,000 from the previous week's unrevised level of 304,000. Economists had expected jobless claims to show a somewhat more modest decrease to 290,000.

At 10 am ET, the Philadelphia Federal Reserve is scheduled to release the results of its manufacturing survey for the region. The consensus estimate calls for an increase in the diffusion index of business activity to 8.2 in February.

The diffusion index of current activity fell to 6.3 in January from 24.5 in December. The new orders index slipped to 8.5 from 13.6, the shipments index fell to -6.9 from 15.1 and the employment index declined to -2 from 8.4. On the other hand, the 6-month outlook index was at a strong 50.9.

Also at 10 am ET, the Conference Board is set to release its U.S. leading economic indicators index for January. Economists expect the index to have risen 0.3 percent month-over-month.

In December, the leading economic indicators rose 0.5 percent month-over-month, with the interest rate spread component of the index playing a big part in the upside. The coincident and lagging economic indicators were up 0.2 percent and 0.3 percent, respectively.

The Energy Information is scheduled to release its weekly petroleum status report for the week ended February 13th at 11 am ET.

Crude oil stockpiles increased by 4.9 million barrels to 417.90 million barrels in the week ended February 6th. Inventories were at the highest level for this time of year in at least the last 80 years.

Additionally, gasoline inventories climbed by 2 million barrels and were well above the upper limit of the average range. Meanwhile, distillate inventories fell by 3.3 million barrels and were in the lower half of the average range.

Refinery capacity utilization averaged 88.4 percent over the four weeks ended February 6th compared to 88.6 percent over the four weeks ended January 30th.

The Treasury Department is also due to make announcements concerning next week's auctions of 2-year, 5-year and 11-year notes at 11 am ET.

Stocks in Focus

Wal-Mart (WMT) reported fourth quarter underlying earnings per share from continuing operations that beat estimates, while consolidated revenues were shy of estimates.

Hormel Foods (HRL) reported better than expected first quarter earnings, while its revenues missed estimates. The company also raised its earnings guidance for 2015.

Priceline.com (PCLN) reported better than expected fourth quarter results and also announced an additional $3 billion stock buyback plan.

Ball (BLL) announced a deal to buy Rexam for 5.4 billion pounds in cash and stock.

Barrick Gold (ABX) reported fourth quarter adjusted earnings and revenues that beat estimates despite gold production declining year-over-year.

Planotronics (PLT) announced that its board has authorized the buyback of an additional 1 million shares.

Avis Budget (CAR) reported fourth quarter earnings that exceeded estimates, while its revenues were shy of estimates. The company's earnings guidance for 2015 was in line, while its revenue guidance was weak.

Marriott (MAR) reported better than expected fourth quarter results and issued upbeat guidance for the first quarter and the full year.

BJ Restaurant (BJRI) also reported better than expected fourth quarter earnings. EOG Resources (EOG) reported better than expected fourth quarter results but announced a cut in its capital spending program.

Marathon Oil (MRO) reported below consensus earnings for its fourth quarter, while its revenues were ahead of expectations. The company also announced a further 20 percent reduction to its capital budget.

Brocade (BRCD), Con Edison (ED), Intuit (INTU), Marvell (MRVL), Newmont Mining (NEM), Nordstrom (JWN), Public Storage (PSA) and Tesoro (TSRO) are among the companies due to release their quarterly results after the close of trading.