Stock Futures Lower as IMF Cuts Growth Outlook
NEW YORK ( TheStreet) -- Stock futures were wavering Tuesday ahead of the start of the new earnings season, and amid a downgrade of global growth estimates from the International Monetary Fund.
Meanwhile Spain's bailout plans remained uncertain.
"The monthly meeting of Eurozone finance ministers ended with little fanfare," said Gareth Berry, foreign-exchange strategist at UBS.
"The markets continue to look to Spain to ask for a bail out, though the Ecofin is not the group to apply that pressure (at least, not in public)," added Paul Donavan, a global economist at UBS. "The German government says Spain does not need a bail out. This might be an instance of the German sense of humor; it is hard to tell."
Futures for the Dow Jones Industrial Average were up 5 points, or 7.65 points below fair value, at 13,506. Futures for the S&P 500 were up 0.90 points, or 0.37 points above fair value, at 1451. Futures for the Nasdaq were falling 2.50 points, or 5.47 points below fair value, at 2775.
The International Monetary Fund said in its latest World Economic Outlook, unveiled in Tokyo ahead of meetings this week of global finance chiefs in the city, that the global economy could grow 3.3% in 2012 and 3.6% in 2013, below its prior forecasts of 3.5% this year and 3.9% next year.
"Low growth and uncertainty in advanced economies are affecting emerging market and developing economies through both trade and financial channels, adding to homegrown weaknesses," said IMF Chief Economist Olivier Blanchard.
However, prospects could improve if clouds over the euro area and the U.S. "fiscal cliff" are lifted, the report added.
The major U.S. stock averages fell Monday with investors ill at ease about the possible outcome of a two-day meeting between European finance ministers and the World Bank's downgrade of China and East Asia's growth prospects.
On the U.S. economic front Tuesday, the National Federation of Independent Business' small business optimism index fell to 92.8 in September from 92.9 in August.
The FTSE 100 in London was down 0.21% and the DAX in Germany was lower by 0.39% Tuesday. German Chancellor Angela Merkel's travels to Greece for the first time since the debt crisis began.
The Nikkei Average in Tokyo finished down 1.06%. The Hang Seng in Hong Kong closed up by 0.54% after a big liquidity injection by China's central bank into the country's money markets.
November crude oil futures were up 53 cents at $89.86 a barrel. December gold futures were up 10 cents at $1,776 an ounce.
The benchmark 10-year Treasury was rising 15/32, diluting the yield to 1.699%. The dollar was up 0.23%, according to the dollar index.
On the corporate front, Alcoa(AA) , the first component of the Dow to report each quarter, is expected by analysts after Tuesday's closing bell to post third-quarter earnings at breakeven on a per-share basis.