MarketWatch.com - Pre-Market Indications

Friday, June 25, 2010

Indications: U.S. stock futures down as bank reform deal met

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By Steve Goldstein, MarketWatch

LONDON (MarketWatch) -- U.S. stock futures declined Friday as Congressional negotiators reached agreement on sweeping reforms intended to reduce the chances of another banking sector implosion.

S&P 500 futures sipped 3 points to 1,067.50 and Nasdaq 100 futures fell 8.75 points to 1,840.70. Futures on the Dow Jones Industrial Average fell 27 points.

U.S. stocks suffered through a rocky session Thursday, with the Dow Jones Industrial Average retreating 145 points on a day when 30-year mortgage rates fell to their lowest point in nearly 40 years. Worries about the health of the housing market as well as financial and energy reform weighed.

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In the early hours of Friday, Senate and House negotiators reached a deal on bank sector legislation, with the deal loosening some of the tougher restrictions that had been proposed. Nonetheless, the bill which still needs to be voted on by the full House and Senate would craft new consumer protections, install new capital and leverage limits on large banks as well as limit proprietary trading activities.

Bank reform globally also is in the spotlight ahead of this weekend's G-20 event in Toronto. A committee of banking regulators will pare back some of its planned rules to force banks to set aside billions of dollars of extra capital, the Financial Times reported Friday.

In very thin premarket trade, Goldman Sachs /quotes/comstock/13*!gs/quotes/nls/gs (GS 134.98, -0.09, -0.07%) shares edged up 1%.

Research In Motion /quotes/comstock/15*!rimm/quotes/nls/rimm (RIMM 58.59, -1.05, -1.76%) may be active as it reported a 20% rise in fiscal first-quarter profit and said it would buy back up to 31 million shares, though it didn't ship as many BlackBerrys as analysts had anticipated.

Oracle /quotes/comstock/15*!orcl/quotes/nls/orcl (ORCL 22.22, -0.46, -2.03%) , the business software giant, reported a stronger-than-forecast 25% rise in fiscal fourth-quarter profit. Oracle said new software license sales rose 14%.

BP /quotes/comstock/13*!bp/quotes/nls/bp (BP 28.74, -0.93, -3.13%) slumped in London trade. The oil giant said total costs of cleaning the Gulf of Mexico oil spill reached $2.35 billion, as analysts at Nomura suggested the company needs to raise money by selling stock to assure sufficient funding.

On the economic calendar, the third release of first-quarter U.S. GDP is due, as is the final reading of the University of Michigan's June consumer sentiment index.

The Stoxx Europe 600 fell 0.5% in late morning trade, while the Nikkei 225 dropped 1.9% in Tokyo.

Oil futures edged 40 cents a barrel lower, and the euro /quotes/comstock/21o!x:seurusd (CUR_EURUSD 1.2281, -0.0045, -0.3651%) fell 0.5% to $1.2268.

Steve Goldstein is MarketWatch's London bureau chief.


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