Posted:2007-6-5|Source:Examiner.com|No. of Views:
(AP Photo/Color China Photo)
A worker at the stock exchange analyzes the stocks movement on an electronic board at the stock exchange in Chengdu of China's Sichuan province on Monday, June 4 2007. Chinese stocks plunged Monday following government efforts to cool a market boom, recording their biggest one-day drop since a February fall that triggered a global sell-off. Beijing has been trying to cool a boom that by last week had pushed up Chinese stocks more than 50 percent, attracting millions of first-time investors who are pouring their savings into the market.
NEW YORK (Map, News) - Stocks pointed toward a lower opening Monday as Wall Street turned its focus overseas to a sharp decline in Chinese stocks.
U.S. investors appeared a bit nervous after the benchmark Shanghai Composite Index plummeted 8.3 percent, its biggest one-day drop since the Feb. 27 plunge that set off a brief global market selloff. The Chinese government has been trying to cool the country's market boom, causing the index to fall 15 percent since a record high last Tuesday.
However, the China selloff didn't cause big ripples in Asia or Europe Monday - a good sign for the U.S. stock market. Stocks in Australia, South Korea and the Philippines rose to record highs, while Tokyo's Nikkei 225 index edged up 0.08 percent and Hong Kong's benchmark idex rose 0.6 percent.
Investors will later be closely reading the Commerce Department's report on April factory orders, which are expected to have risen 0.7 percent after a 3.1 percent jump in March. The report is due for release at 10 a.m. EDT.
Dow Jones industrial futures expiring in June fell 32, or 0.23 percent, to 13,657.
Standard & Poor's 500 index futures fell 3.90, or 0.25 percent, to 1,535.70.
Nasdaq 100 index futures declined 5.50, or 0.28 percent, to 1,926.75.
Last week, the Dow posted a 1.19 percent gain; the S&P 500 index rose 1.36 percent; and the Nasdaq composite index added 2.22 percent.
In earnings data Monday, Krispy Kreme Doughnuts Inc. (KKD, News) will release its first-quarter earnings. Analysts are predicting profit to come in at 5 cents a share.
In other corporate news, Wal-Mart Stores Inc. (WMT, News) - the Dow's biggest gainer on Friday - could see its stock rise further after being upgraded by analysts at Wachovia Corp. (WB, News) and JPMorgan Chase & Co. (JPM, News)
And the flurry of deal-making activity continued Monday.
Smartphone maker Palm Inc. (PALM, News) said Monday it got $325 million from private equity firm Elevation Partners and announced a shakeup on its board, while The Wall Street Journal reported that Avaya Inc. (AV, News) came a step closer to being acquired by private-equity firms TPG Capital LLP and Silver Lake Partners.
The dollar slipped against other major currencies after the upbeat employment data, while gold prices fell.
Crude oil futures fell 42 cents to $64.66 a barrel in preopening electronic trading on the New York Mercantile Exchange.
In other overseas trading, Britain's FTSE 100 was down 0.28 percent in the afternoon, Germany's DAX index was down 0.45 percent, and France's CAC-40 was down 0.52 percent.
