Stock Futures Fall Ahead of Earnings

LONDON – U.S. stock market futures dropped on Tuesday as investors drew cautious on key technology bellwethers Intel Corp. and Yahoo Inc. ahead of earnings news.

Dow Jones futures were recently down 31 points, S&P 500 futures fell 3.8 points and Nasdaq futures dropped 9 points.

U.S. markets closed with a mild rise, though the Dow industrials did reach another record closing high. Strong gains for Alcoa Inc., Exxon Mobil Corp. and Merck among others offset broker downgrades for General Electric Co. and Home Depot Inc., sending the Dow up 20 points, the Nasdaq Composite up 6.5 points and the S&P 500 up 3.4 points.

Quarterly releases will come on Tuesday from corporate heavyweights including Johnson & Johnson, United Technologies, and Merrill Lynch.

After Tuesday’s close, chip giant Intel, technology behemoth International Business Machines, phone maker Motorola and Internet services group Yahoo unveil quarterly results.

Goldman Sachs didn’t wait for Intel results to come out, downgrading the chip giant to neutral on valuation grounds.

Intel shares dropped 1.8 percent in German trading. Yahoo shares also dropped ahead of their quarterly results, losing 2 percent in Germany.

There’s also a bevy of economic data, including producer price index, industrial production and capacity utilization for September and August Treasury capital flows.

The October NAHB housing market index also is due out.

The dollar was down against the British pound and the yen, but flat against the euro after German investor confidence slumped to a 13-year low.

Gold futures were holding below $600 an ounce in electronic trading, with the December contract flat at $598.50.

Oil futures edged 16 cents higher at $60.10 a barrel.

Of other companies in focus, Wal-Mart Stores has agreed to buy a key Chinese hypermarket chain for $1 billion, according to reports in The Wall Street Journal and The New York Times. Carrefour was the losing bidder for Taiwan-owned Trust-Mart. The Journal first reported the story late in the trading day on Monday.

InterMune is expected to jump after reaching a deal to commercialize a Hepatitis C products with Roche Holdings.

Roche separately reported a stronger-than-forecast 19 percent sales rise behind sales of cancer drugs and Tamiflu.

Callaway Golf may see pressure after warning of a widening loss in the third quarter, as quarterly sales were hit by lower in-store traffic at key golf retailers during the summer season.

Overseas, the Nikkei 225 ended 0.5 percent lower in Tokyo while the FTSE 100 dropped 0.3 percent in London.