Futures drop on tech stocks, ahead of Bernanke

NEW YORK (Reuters) - Stock index futures were lower on Wednesday as Intel joined the ranks of technology companies that recently cut their earnings outlooks, as tepid growth in the U.S. and slowing global economies dent consumer spending.

Financials will be in focus following results from Bank of America Corp , which reported a drop in its second-quarter sales and trading revenue. The Dow component fell 0.6 percent to $7.87 in premarket trading.

Intel Corp late Tuesday cut its full-year revenue outlook, and the company said consumer spending in Europe and the United States was softer than previously thought.

Advanced Micro Devices and Applied Materials have also cut their guidance in recent weeks, contributing to month-to-date losses of more than 2 percent in the S&P information technology index <.GSPT>. The group is considered a proxy for business spending, and the weak views in the sector could have broader implications.

S&P 500 futures fell 4.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures fell 38 points and Nasdaq 100 futures lost 7.25 points.

Earnings reports at large continue to be solid. With 7 percent of S&P 500 companies having reported, 65 percent have beaten profit expectations, according to the latest Thomson Reuters data. Only 15 percent have missed.

A number of key reports will be released on Wednesday, including those of American Express Co and International Business Machines Corp . Bank of New York Mellon and PNC Financial reported earlier on Wednesday.

Investors will also be looking to Ben Bernanke, the U.S. Federal Reserve chairman, who will deliver the semi-annual "Monetary Policy Report to the Congress" before the House Financial Services Committee.

Bernanke testified before a Senate committee on Tuesday, and while he didn't give any specifics over what the central bank might do to accelerate growth amid signs of weakness, he left the door open to more stimulus if it became clear unemployment was not falling or if deflation risks mounted.

June housing starts will be released at 8:30 a.m. (1230 GMT) and are seen edging higher from the previous month.

Wall Street rose on Tuesday, lifted by strong results from Goldman Sachs and Coca-Cola Co . Still, the S&P has posted losses in seven of the last nine sessions, falling about 1 percent.

(Editing by Bernadette Baum)

WhatsAppFacebookTwitterLinkedinBeloudBluesky