Dow Futures Fall As US Shutdown Fears Grow

LONDON — Stock index futures at 7am ET indicate that the Dow Jones Industrial Average (DJINDICES: ^DJI) may open down by 0.14% this morning, while the S&P 500 (SNPINDEX: ^GSPC) may open 0.17% lower. CNN’s Fear & Greed Index has slipped back into the fear zone, and is expected to open at 42 this morning, after closing at 50 last night.

European markets edged lower this morning as investors remained concerned about the potential for a US government shutdown in October, after Treasury Secretary Jack Lew warned investors that their confidence a deal will be struck to increase the debt ceiling is “greater than it should be”. A Senate vote is scheduled later today on a temporary measure to allow spending to continue beyond the deadline, while budget negotiations continue. In the UK, cruise-ship operator Carnival fell more than 6% after both Morgan Stanley and Natixis downgraded the firm. At 7am ET, the FTSE 100 was down 0.40%, the DAX was down 0.46%, and the CAC 40 was down 0.44%.

Today’s US economic calendar kicks off with August’s durable goods orders report, at 8.30am ET. Forecasts suggest that orders fell by 1.5% in August, after falling by 7.4% in July. Next, at 10am, investors will get another round of housing data, courtesy of August’s new home sales report. Analysts expect 420,000 new homes to have been sold last month, up from 394,000 in July. Finally, at noon, second-quarter household debt figures are due.

Corporate earnings remain thin today, but earlier this morning, AutoZone reported fourth-quarter earnings of $10.42 per share, beating analysts’ forecasts for earnings of $10.34 per share. After markets close, Jabil Circuit is expected to report fourth-quarter earnings of $0.54 per share, while Bed Bath & Beyond is expected to report second-quarter earnings of $1.15 per share.

Stocks that may be actively traded today include cruise ship operator Carnival Corporation, which closed down by 7.7% in New York trading yesterday, and fell by a further 4.5% in pre-market trading this morning. Offshore rig operator Noble Corp was 3.7% higher in after-hours trading last night, and may be in demand when markets open, after the company said that it would spin-off around half of its rig fleet into a new company, in order to focus its core business on more profitable deepwater work.

Finally, let’s not forget the Dow's daily movements can add up to some serious long-term gains. Indeed, Warren Buffett recently wrote: "The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions."

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> Roland does not own shares in any of the companies mentioned in this article.