Indications: Futures drop after Dow Chemical, P&G earnings

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By Polya Lesova, MarketWatch

FRANKFURT (MarketWatch) -- U.S. stock futures fell Tuesday after the previous session's rally, as disappointing earnings reports from Dow Chemical Co. and consumer-products giant Procter & Gamble Co. soured sentiment on Wall Street.

Futures on the Dow Jones Industrial Average dropped 23 points to 10,594. S&P 500 futures slipped 2.50 points to 1,119.30, and Nasdaq 100 futures lost 1 point to 1,893.20.

The Dow /quotes/comstock/10w!i:dji/delayed (DJIA 10,674, +208.44, +1.99%) rallied 208.44 points, or 1.99%, to end at 10,674.38 Monday, snapping a three-day losing streak and posting the biggest one-day point gain since July 7.

European equities see bearish derivative flows

European stock markets have risen strongly recently in thin volumes, but aside from the financials, most sectors have seen bearish derivate trades, with investors selling calls to take profits and buying puts as protection, says Barclays Capital.

The U.S. market "seems to have had an injection of fresh enthusiasm yesterday, so it should be an interesting session ahead to see if investors have the courage to build on yesterday's gains and target 10,700 once again," said Yusuf Heusen, senior sales trader at IG Index, in a note to clients.

Shares of Procter & Gamble /quotes/comstock/13*!pg/quotes/nls/pg (PG 62.06, +0.90, +1.47%) fell 2.5% in premarket trading after the consumer-products giant reported that its fourth-quarter net income declined 12% to $2.19 billion, or 71 cents a share.

On average, analysts had been expecting earnings of 73 cents a share, according to data compiled by FactSet Research.

Shares of Dow Chemical /quotes/comstock/13*!dow/quotes/nls/dow (DOW 28.33, +1.00, +3.66%) dropped 3.6% in premarket trading, as its quarterly profit missed analysts' estimates.

On the positive side, shares of Pfizer /quotes/comstock/13*!pfe/quotes/nls/pfe (PFE 15.48, +0.48, +3.20%) gained 2.4% in premarket trading, as the pharmaceutical giant reported second-quarter earnings of 31 cents a share.

On the economic front, data on June personal income will be released at 8:30 a.m. Eastern time. In addition, factory orders and pending-home sales for June will be reported at 10 a.m. Eastern.

BMW shares rally

Shares of BMW AG /quotes/comstock/11e!fbmw (DE:BMW 43.60, +1.74, +4.16%) rallied 4.1% in Frankfurt after the German premium-car maker reported a surge in second-quarter profit as vehicle sales rose nearly 13%. See more on BMW's results.

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The Stoxx Europe 600 index /quotes/comstock/22c!sxxp (ST:SXXP 261.19, -0.90, -0.34%) dropped 0.3% in intraday trading, as traders locked in some recent gains.

In London, shares of mining giant Xstrata PLC /quotes/comstock/23s!a:xta (UK:XTA 1,077, +2.00, +0.19%) gained 0.4%. The firm's first-half net profit more than tripled to $2.29 billion as revenue grew 43% to $13.61 billion. See more on Xstrata.

Spanish lender Banco Santander /quotes/comstock/13*!std/quotes/nls/std (STD 13.58, +0.81, +6.34%) /quotes/comstock/06x!csan (ES:SAN 10.36, +0.02, +0.14%) is close to completing a deal to buy 318 branches from Royal Bank of Scotland Group /quotes/comstock/23s!a:rbs (UK:RBS 51.75, -0.35, -0.67%) and will also acquire a multibillion-dollar pool of car loans from HSBC Holdings /quotes/comstock/13*!hbc/quotes/nls/hbc (HBC 53.74, +2.66, +5.21%) in the U.S., according to media reports.

Italian banking giant UniCredit SpA /quotes/comstock/23g!ucg (IT:UCG 2.22, 0.00, 0.00%) is scheduled to report quarterly results later Tuesday.

Asian shares finished mostly higher Tuesday, but China's Shanghai Composite index fell 1.7%.

On the New York Mercantile Exchange, September crude-oil futures gained 50 cents to $81.84 a barrel in electronic trading after rallying in the previous session.

The dollar index /quotes/comstock/11j!i:dxy0 (DXY 80.58, -0.35, -0.44%) , which tracks the performance of the greenback against a basket of other major currencies, fell 0.4% to 80.644.

The euro /quotes/comstock/21o!x:seurusd (EURUSD 1.3231, +0.0053, +0.4022%) gained 0.4% to $1.3226.

Polya Lesova is a reporter for MarketWatch, based in Frankfurt.

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NYSE Arca Morning Update - 08:30:00 ET

NYSE Arca Morning Update for Tuesday, Aug 3, 2010 :

STOCKS TRADING ON NYSE Arca AT A PRICE 15% OR MORE AWAY FROM
THE PREVIOUS TRADE DAY'S CONSOLIDATED CLOSE PRICE (AS OF 08:30:00 ET)

Stock Monday's Close Current Price Pct Change Current NYSE ARCA Vol
SYKE $15.29 $10.28 (32.8%) 151,821

10 MOST ACTIVE STOCKS ON NYSE ARCA AS OF 08:30:00 ET

BASED ON DOLLARS TRADED: | BASED ON SHARES TRADED:
Stock $ Volume Price PctChg | Stock Share Vol Price PctChg
SPY $75,349,596 $112.49 ( 0.2%) | MET 944,541 $42.33 ( 0.9%)
MET $39,994,326 $42.33 ( 0.9%) | PFE 771,372 $16.19 4.7%
PFE $12,300,361 $16.19 4.7% | SPY 669,781 $112.49 ( 0.2%)
PG $11,876,110 $59.92 ( 3.4%) | KGC 274,710 $15.46 ( 5.3%)
GLD $8,423,482 $116.02 0.4% | PG 197,604 $59.92 ( 3.4%)
EEM $7,696,549 $42.18 ( 0.7%) | YRCW 183,172 $0.40 ( 0.6%)
CTSH $6,518,688 $62.40 12.5% | EEM 182,394 $42.18 ( 0.7%)
BP $5,171,625 $39.17 ( 0.8%) | SYKE 151,821 $10.28 (32.8%)
MA $5,157,157 $202.60 0.2% | BP 131,901 $39.17 ( 0.8%)
KGC $4,278,988 $15.46 ( 5.3%) | SOLF 124,196 $11.60 13.3%

Price changes may be affected by symbol splits and dividends.

Consolidated close price is the last print (excluding prints with trade
conditions) prior to 4PM ET.

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