Wall St.'s tech worries
Concerns about tech earnings growth ahead of Cisco report has futures lower; GM moves considered.
NEW YORK (CNNMoney.com) - Tech earnings anxiety appeared to be casting a shadow over stocks ahead of Tuesday's market open, with investors shrugging off the latest General Motors turnaround effort.
U.S. stock futures were down, indicating a lower opening for U.S. markets, as futures of the tech-heavy Nasdaq trailed the blue-chip S&P 500 futures.
After the bell Tuesday, tech bellwether Cisco Systems (Research), the leading maker of computer network equipment maker, is due to report earnings for its fiscal second quarter, as well as give new sales and earnings guidance. Last week, disappointing results from Google (Research) and Amazon.com (Research) hurt tech stocks.
The Wall Street Journal's influential "Heard on the Street" column cast questions about the growth prospects for Cisco. Shares were down in early Frankfurt trading Tuesday, as were a number of other leading tech companies, including Microsoft (Research), Intel (Research), Yahoo! (Research), IBM (Research) and Apple Computer (Research).
Oil prices were lower ahead of Wednesday's U.S. fuel inventory report, which is expected to show an increase in supplies. The March light crude futures contract for NYMEX fell 63 cents to $64.38 a barrel in electronic trading, while the March contract for Brent crude lost 69 cents to $62.64.
Major markets in Asia closed mostly lower Tuesday. After the close in Tokyo Toyota Motor (Research), Japan's largest automaker, reported strong quarterly earnings. Major European markets were lower in early trading, after BP (Research), the region's largest oil company, reported lower-than-expected fourth-quarter earnings.
In corporate news, General Motors (Research) will cut its dividend in half, reduce senior management compensation and enact cost-cutting changes in its pension and health care plans for salaried employees. The move is part of a continued turnaround effort by the world's No. 1 automaker. On Monday, GM named Jerry York, an adviser to largest single shareholder Kirk Kerkorian, to the GM board. Shares of GM rose in Inet trading.
The nation's No. 2 media conglomerate, Walt Disney (Research), reported an unexpected rise in earnings after the close Monday on strong theme park traffic and advertising revenue. The company also announced a $2.7 billion deal to merge its ABC Radio unit with Citadel Broadcasting, a deal that will give Disney 52 percent control of the new company. Shares of Disney were up more than 1 percent in Frankfurt trading.
No. 1 media conglomerate Time Warner (Research) will be under fire Tuesday when activist shareholder Carl Icahn lays out his plans to break up the company in order to improve share value. CNNMoney.com is a unit of Time Warner.
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