Sentiment Subdued Amid Mixed Catalysts

(RTTNews) - The major U.S. index futures are pointing to a lower opening on Tuesday, with sentiment reflecting subdued mood as earnings news continues to be mixed and clarity is still to emerge concerning the economic outlook. Earnings news of the day has been mixed, with outperformance and disappointments as well. Housing starts data released earlier in the day also had a mixed connotation. Though housing starts came in ahead of expectations, building permits were weaker. European stocks are seeing weakness. Traders in the domestic markets may also focus on Fed speeches scheduled for the day.

U.S. stocks ended a lackluster session on Monday little changed, as a retreat in commodity prices and some disappointing earnings rendered the mood negative. The major averages opened lower, with the Dow Industrials and the S&P 500 Index languishing below the unchanged line for much of the session before recouping towards the close of the session. The Dow Industrials ended up 14.57 points or 0.08 percent at 17,230 and the S&P 500 Index closed 0.55 points or 0.03 percent higher at 2,034. The Nasdaq Composite went about a volatile ride before ending up 18.78 points or 0.38 percent at 4,906.

Among the 30 Dow components, fourteen stocks advanced and two stocks ended unchanged, while the remaining fourteen stocks declined. Nike (NKE), Intel (INTC), Disney (DIS) and Visa (V) were among the biggest gainers of the session, while Exxon Mobil (XOM), United Technologies (UTX) and Chevron (CVX) retreated notably.

Among the sectors, airline stocks gained ground, while energy stocks came under selling pressure.

On the economic front, the National Association of Home Builders said its housing market index unexpectedly rose to 64 in October from a downwardly revised reading of 61 in September. The current sales conditions index rose 3 points to 70 and the sales expectations index was up 7 points to 75, while the index measuring prospective buyer traffic was unchanged at 47.

Currency, Commodity Markets

Crude oil futures are rising $0.14 to $46.03 a barrel after declining $1.37 to $45.89 a barrel on Monday. Meanwhile, an ounce of gold is currently trading at $1,171.70, down $1.10 from the previous session's close of $1,172.80. On Monday, gold fell $10.30.

On the currency front, the U.S. dollar is trading at 119.43 yen compared to the 119.50 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1329 compared to yesterday's $1.1327.

Asia

The major Asian markets ended mixed, as the lackluster lead from Wall Street overnight failed to rev up sentiment. However, the Chinese and New Zealand markets advanced notably.

The Japanese market rebounded, as the yen's weakness proved positive for the export-heavy Nikkei 225 Index. The index hovered above the unchanged line throughout the session before ending up 75.92 points or 0.42 percent at 18,207.

Chemical, paper, pharma, financial and most export stocks moved to the upside, while construction, real estate, rubber, glass, cement and utility stocks declined.

Australia's All Ordinaries Index languished below the unchanged line throughout the session before ending down 33 points or 0.62 percent at 5,272. Material and energy stocks came under intense selling pressure, while defensive healthcare, real estate, telecom and industrial stocks escaped the brunt of selling pressure.

Hong Kong's Hang Seng Index ended at 22,989, down 86.39 points or 0.37 percent, while China's Shanghai Composite rallied 38.63 points or 1.14 percent before ending at 3,425.

On the economic front, the minutes of the Reserve Bank of Australia's October Monetary Policy Committee meeting showed that the board is of the view that the country's economic recovery is moving at a gradual pace but continues to be on track. The minutes downplayed the need for an immediate rate hike to support growth.

According to the central bank, the rebalancing of the economy is being supported by the depreciation of the Australian dollar and inflation is expected to remain consistent with the target for at least the next year.

Europe

European stocks opened on a nervous note and showed indecision in early trading before taking a steep plunge. The markets were digesting some domestic earnings and looked ahead to the U.S. housing starts data due later in the day.

In corporate news, German business software giant SAP (SAP) reported higher third quarter profits on strong subscriptions to its cloud software. The company also affirmed its full year guidance.

The U.K.'s Whitbread also reported strong profits for its first half, boosted by performance of its Costa Coffee chain. InterContinental Group reported room REVPAR growth of 4.8 percent year-over-year in the third quarter.

On the economic front, a report released by the German Federal Statistical Office showed that German producer prices declined 2.1 percent year-over-year, the fastest pace in seven months. The decline was steeper than the 1.8 percent drop economists had predicted. On a monthly basis, producer prices were down 0.4 percent.

The Eurozone's current account surplus decreased sharply in August, figures from the European Central Bank showed. The current accounts surplus declined to an unadjusted 17.7 billion euros from 25.6 billion euros in July.

U.S. Economic Reports

Housing starts in the U.S. rose more than expected in the month of September, according to a report released by the Commerce Department.

The report said housing starts climbed 6.5 percent to an annual rate of 1.206 million in September from the revised August estimate of 1.132 million. Economists had expected housing starts to rise to a rate of 1.147 million.

Meanwhile, the Commerce Department said building permits tumbled 5.0 percent to an annual rate of 1.103 million in September from 1.161 million in the previous month.

New York Federal Reserve Bank President William Dudley and Federal Reserve Governor Jerome Powell are due to give opening remarks at the New York Fed conference on the structure of the treasury market at 9 am ET.

Federal Reserve Chair Janet Yellen is schedule to make the welcoming remarks at a Labor Department ceremony in Washington at 11 am ET.

Stocks in Focus

IBM (IBM) reported better than expected third quarter profits, while its revenues missed expectations. The company also lowered its full year guidance.

United Technologies (UTX) reported third quarter adjusted earnings per share, while its revenues missed estimates. The company's full year results were in line.

Verizon (VZ) reported better than expected third quarter adjusted earnings.

Travelers Companies (TRV) reported better than expected third quarter results.

Bank of New York Mellon's (BK) third quarter adjusted earnings were ahead of estimates.

Rambus (RMBS) reported below consensus results for its third quarter, and the company's fourth quarter revenues guidance was weak.

Flextronics (FLEX) reported better than expected second quarter adjusted earnings and sales and issued in line guidance for the third quarter.

Sonic (SONC) reported fourth quarter adjusted earnings and revenues that exceeded estimates. The company also raised its earnings per share outlook for the full year.

Varian Medical Systems (VAR) lowered its adjusted earnings per share guidance for the full year to $4.29 per share, below the consensus estimate of $4.40 per share, citing a shortfall of revenues in its Oncology Systems business.

Zion Bancorp.'s (ZION) third quarter earnings trailed expectations.

Steel Dynamics (STLD) reported in line third quarter adjusted earnings, while its revenues fell 16.7 percent year-over-year.

Brown & Brown (BRO) reported in line earnings for its third quarter, while its revenues trailed estimates.

RLI (RLI) reported better than expected operating earnings for its third quarter and its revenues rose 1.7 percent.

Humana (HUM) announced that its shareholders voted to approve its acquisition by Aetna (AET).

CIT (CIT) said its CFO Scott Parker announced his departure from the company to assume the role of CFO at Springleaf Holdings (LEAF).

United Continental (UAL) announced that its president and CEO Oscar Munoz has gone on a medical leave of absence following a heart attack and that Brett Hart, its general counsel, has been appointed as acting CEO.

Celestica (CLS), Chipotle Mexican Grill (CMG), Cree (CREE), Discover Financial Services (DFS), Packaging Corp. of America (PKG), Vmware (VMW) and Yahoo (YHOO) are among the companies due to release their quarterly results after the close of trading.