9:00AM U.S. stock futures pointed lower, as reduced profit outlooks from Home Depot and Sears weighed.

U.S. stock futures pointed to a lower opening Tuesday, reflecting unimpressive start to Q2 earnings season and worries about corporate earnings, due to lowered profit outlooks from two retail companies. Renewed housing and inflation concerns ahead of a speech from Fed Reserve Chairman Ben Bernanke also weighed. The market also awaited the Commerce Department report on wholesale inventories, expected to show a 0.4% increase.

Aluminum giant Alcoa (AA: chart) added 0.7% in the pre-open after posting in-line-with-estimate 4% profit decline. However, quarterly revenue missed the average analyst forecast Dow member Home Depot (HD: chart) warned that 2007 earnings will fall more than expected, blaming the slowing housing market. Shares of the home improvement retailer added 1% in pre-market trading.

At the same time, Sears Holdings (SHLD: chart) dropped 5.3% after it warned of lower-than-expected Q2 profit, due to weak sales. Among other companies posting quarterly results, Greenbrier (GBX: chart) surged 19% after reporting better-than-forecast earnings. Cheesecake Factory (CAKE: chart) gained on a 16% rise in Q2 revenue.

In other corporate news, General Motors (GM: chart) and Ford (F: chart) were upgraded to overweight at J.P. Morgan. S&P 500 futures dropped 4.7 points at 1,537.80 and Nasdaq 100 futures fell 9.5 points at 1,999.00. Dow industrial futures fell 30 points. Yields on 10-year Treasury bonds fell to 5.12%.


8:30AM Asian markets end mixed with Japan declining on stronger yen, and China falling on profit-taking.

In Tokyo, the index edged lower as real estate stocks and export shares declined. The benchmark Nikkei 225 Average finished 0.05% lower at 18,253. The yen strengthened to 123.43 per dollar from 123.65 at yesterday's close. The real estate sector lost on fears that the Bank of Japan may raise interest rates in near future. Two of the biggest real estate developers dropped. Mitsui Fudosan dipped 1.4% and Mitsubishi Estate lost 1.5%. Exporters also suffered as the yen strengthened against the dollar. Toyota lost 0.5 percent, while Canon Inc. fell 1 percent.

In Hong Kong, expectations of strong first-half earnings from Chinese banks led the rally. The Hang Seng Index gained 0.3% to close at 22,886. Industrial & Commercial Bank of China surged 5.1% as the largest bank by assets in the country announced that its first-half net profit is likely to advance more than 50% from a year earlier. China Merchants rallied 7.2% as it also expects first-half profit to double from the same period the previous year.

Banks and telecoms buoyed South Korea. The Kospi Index in Seoul advanced 0.6% to 1,895. An upward revision of the country’s gross domestic product by the Bank of Korea to 4.5% from 4.4% also boosted the rally. Kookmin Bank gained 2.2% and Shinhan Financial Group closed 5.7% higher.

In China, gains from the banking sector were pared by profit-taking. The benchmark Shanghai Composite Index retreated 0.8% to settle at 3,853. Youngor Group dropped 1.5% and Shanghai Automotive lost 3.2%, while ICBC ended 1.7% higher and China Merchants rallied 7.5%.

In Sydney, resources stocks declined on profit-taking, erasing some of the gains they have won in recent sessions. Australian S&P/ASX 200 shed 0.6% to 6,362. In copany news, BHP Billiton shed 1% after advancing 3.5% on Monday, while Rio Tinto inched 0.1% higher. Lead and zinc company Zinifex plunged 3.9%.


7:30AM NY-6:30PM Mumbai Sensex sheds 36 points, Tata Motors rallies, the rupee advances.

The Sensex on BSE finished 35.85 points lower, or 0.24%, at 15,009.88.

The benchmark index opened 54 points higher at 15,100.13 and rallied to a record high of 15,114.95 in morning trading, a gain of 69.22 points for the day. It dropped to a low of 14,966.40 in early afternoon trading.

The market-breadth was positive in the morning, but turned negative in the latter part of the session. In the broader market 2,710 stocks traded on the market, 1,170 advanced, while 1,467 declined and only 73 were unchanged. Of the 30 stocks in the Sensex, 14 advanced, while 16 declined. The turnover on BSE was Rs 5,024 crore, higher than Rs 4,845 crore on Monday. On NSE, the turnover was Rs 10,720 crore, compared to Rs 9,762 crore on Monday.

Economic news

The Indian rupee edged higher towards a nine-year high on speculation that overseas funds will buy more local equities as the economy expands. In early trade, the rupee stood at 40.39 per dollar, up from 40.423 on Monday, and close to a nine-year high of 40.28 struck in late May 2007.

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