U.S. stock futures flatten out as oil futures slip

By Steve Goldstein, MarketWatch
Last update: 8:36 a.m. EDT July 8, 2008
LONDON (MarketWatch) - U.S. stock futures moved off lows on Tuesday as the open neared, with a decline in oil helping to compensate for a resurgence in credit-market jitters and nervousness about second-quarter earnings season ahead of a report from Alcoa.
S&P 500 futures rose a fraction of a point to 1,252.60 and Nasdaq 100 futures were up 1.75 points to 1,834.00. Dow industrial futures added 4 points.
U.S. stocks ended lower on Monday, reversing early gains on the back of an oil price retreat and renewed speculation that Microsoft may buy Yahoo. Worries over the capital that Fannie Mae and Freddie Mac may have to raise as well as a report that Lehman Brothers was temporarily barred from trading oil contracts reignited financial sector worries ahead of second-quarter earnings season.

The Dow industrials dropped 56 points, the Nasdaq Composite lost 2 points and the S&P 500 fell 10 points.
Federal Reserve Chairman Ben Bernanke in a speech on Tuesday said Congress would have to give the Fed new powers if it wanted to give the central bank the job to limit the impact of financial market turmoil on the economy.
In a major development on another topic, Bernanke said the Fed was considering extending its emergency loans to broker-dealers beyond 2008 to help stabilize the market. The Fed's emergency primary dealer credit facility is now set to expire in mid-September.
There's also a speech from Richmond Fed President Jeffrey Lacker on the economic outlook, pending home sales data for May as well as wholesale inventories data for May.
Oil futures dropped sharply for a second session, falling $2.70 to $138.67 a barrel. The dollar was roughly flat against the Japanese yen, exchanging hands at 107.15 yen.
Alcoa warned second-quarter North American same-store retail sales dropped 10%. Pepsi Bottling Group edged past earnings estimates for the second quarter but cut its revenue outlook for the year.
LCD TV maker Syntax Brillian sold some assets to TCV Group and filed for protection from creditors under Chapter 11 bankruptcy rules. It expects the common shares to have no value after the filing and reorganization.
International stocks saw heavy pressure, with the Nikkei 225 losing 2.4% in Tokyo. The FTSE 100 lost 0.8% in London, though that was well off session lows. End of Story
Steve Goldstein is MarketWatch's London bureau chief.