Stock Futures Point Lower ahead of Gov't Moves

By: AP
By: AP
Wall Street pointed toward a lower opening Tuesday ahead of the government

The Wall St. street sign is photographed in front of the American flag hanging on the New York Stock Exchange prior to a NYC Central Labor Council rally for worker protections, Thursday, Sept. 25, 2008 in New York. (AP Photo/Mary Altaffer)

NEW YORKWall Street pointed toward a lower opening Tuesday ahead of the government's unveiling of a revamped bank rescue plan and the expected Senate approval of a massive economic stimulus package.

Treasury Secretary Timothy Geithner is scheduled to announce how the government will spend the remaining $350 billion of the $700 billion financial bailout package passed by Congress last fall.

It is expected the plan will impose tough new standards on future payments to banks and will expand an effort to help unfreeze the credit markets and get banks lending again.

The new plan seeks to address widespread criticism that banks were getting billions of dollars in taxpayer support without much oversight and that the government aid failed to increase lending and remedy the financial crisis.

The administration plan, officials said, will include a government-private sector partnership to help remove banks' soured assets from their books.

At the same time, an $838 billion stimulus bill was expected to win approval in the Senate. Congressional leaders hope to have the bill on President Obama's desk before a recess next week.

Ahead of the market's open, Dow Jones industrial average futures fell 26, or 0.32 percent, to 8,192. Standard & Poor's 500 index futures dropped 5.00, or 0.58 percent, to 860.10, while Nasdaq 100 index futures shed 1.75, or 0.14 percent, to 1,274.

Also Tuesday, the Commerce Department will release a report on wholesale trade inventories for December at 10 a.m. Eastern time. And Federal Reserve Chairman Ben Bernanke will testify at a House Financial Services Committee hearing on the central bank's efforts to provide liquidity during the financial crisis.

On Monday, stocks fluctuated between gains and losses for most of the day, ending the session with only modest changes in anticipation of the government's announcements. The Dow Jones industrials fell about 9 points to 8,270. Broader stock indicators were mixed after a big rally last week.

Among corporate news, Swiss bank UBS AG reported a larger-than-expected loss of $7.57 billion in the fourth quarter and announced it would cut another 2,000 jobs.

Molson Coors Brewing and SABMiller said fourth-quarter profit for their joint venture MillerCoors fell 40 percent, partly on a decline in sales to retailers.

Meanwhile, airplane maker and defense contractor Boeing Co. late Monday lowered its reported fourth-quarter and fiscal 2008 earnings per share results, citing lower aircraft values in its customer financing portfolio and increased liabilities linked to an arbitration ruling. Last month, the company reported a surprise fourth-quarter loss and announced plans to cut 10,000 jobs.

Bond prices were mixed early Tuesday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.94 percent from 2.99 percent late Monday. The yield on the three-month T-bill, considered one of the safest investments, was unchanged from late Monday at 0.32 percent.

The dollar was mixed against other major currencies. Gold prices rose.

Light, sweet crude rose $1.63 to $41.19 in electronic premarket trading on the New York Mercantile Exchange.

Overseas, Japan's Nikkei stock average fell 0.29 percent. Hong Kong's Hang Seng index rose 0.81 percent. In afternoon trading, Britain's FTSE 100 was down 0.40 percent, Germany's DAX index was down 0.87 percent, and France's CAC-40 was down 0.57 percent.


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