US futures flat; at closing highs

thephotoholic

thephotoholic

Published May 8, 2013

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New York - US stock index futures were little changed on Wednesday, as investors found little reason to push shares decisively one way or the other, following gains that took indexes to fresh highs a day earlier.

Earlier in the week, S&P 500 futures had also suggested days of little movement on Monday and Tuesday once trading began, but stocks jumped on both days.

The S&P has now risen for four straight sessions, up 2.7 percent over that period, and up more than 14 percent thus far in 2013.

While the market continues to trend upward, with analysts citing the attractive valuation of equities relative to other assets, the magnitude and speed of the rally has spurred expectations of a pullback.

Wall Street hasn't undergone a sustained decline this year as investors buy on market declines.

“There's room for slight gains from here, maybe another percent or two higher, but even though a lot of people are still not in the market, we think investors will want to take profits soon,” said Adam Hewison, chief executive at INO Inc in Annapolis, Maryland.

“We're very close to an interim top.”

S&P 500 futures rose 1 point and were slightly 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 dipped 5 points and Nasdaq 100 futures rose 3 points.

The Dow closed above 15,000 for the first time on Tuesday and the S&P 500 ended at another record high. Both indexes hit all-time intraday highs during the session.

The US stock market's gains this year have come on strong corporate results and accommodative monetary policies from the Federal Reserve. Recently, growth-orientated sectors like energy have led the way higher.

“We're closely watching energy, which could outperform as oil could potentially rise to $110 on signs that the economy is getting better or on any supply disruption from the Middle East,” said Hewison.

Crude dipped 0.2 percent to $95.44 per barrel on Wednesday.

Dow component Walt Disney Co reported earnings late Tuesday that beat expectations and revenue that was up 10 percent, while Whole Foods Market Inc reported a rebound in same-store sales and raised its full-year profit view.

Shares of Disney slid 0.4 percent to $65.80 in premarket trading while Whole Foods advanced 8 percent to $100.25.

J.C. Penney Co Inc reported another quarter of steep sales declines, though investors were cheered that the troubled department store posted cash levels that implied it had gone through less money than feared. The stock rose 5 cents to $16.45 in premarket trading but is down 17 percent so far this year.

Earnings have largely been better than expected. About 68.5 percent of S&P 500 companies have surpassed estimates so far. At the same time, revenues have been disappointing.

News Corp, CenturyLink Inc and CF Industries are among companies due to report Wednesday.

European shares rose, with mining stocks among the day's strongest as strong Chinese trade data indicated a better outlook for one of the world's largest economies. - Reuters

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