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Dow Jones Industrial Average Futures Lower on Pfizer Earnings, Ukraine Worries

Manufacturing in China contracted for a fourth consecutive month

by 5/5/2014 8:13:52 AM
Stocks quoted in this article:

The Dow Jones Industrial Average (INDEXDJX:DJI) is set to start the week in the red, as disappointing earnings from Pfizer Inc. (NYSE:PFE) and growing conflict between Ukraine and Russia pressure the 30-stock index. Also stoking some caution among traders is a weekend report that showed manufacturing in China contracted for a fourth straight month. Stateside, although the economic calendar is light, investors will have the chance to respond to the Institute for Supply Management's (ISM) non-manufacturing index, due at 10 a.m. ET.

Elsewhere, "The 1,880 level on the S&P 500 Index (SPX) continues to be very important, and we're trading there right here and now," said Schaeffer's Senior Trading Analyst Bryan Sapp. "Friday's sell-off on good economic data is a bit of a warning shot for bulls, but if we can hold support here, then I would expect the market to continue higher -- likely above the 1,900 area."

Plus, our Trading Topic of the Week -- 5 Ways to Win with Aggressive Trades: Focus on short-term options. Combat the negative effects of time decay -- and decrease your overall risk -- by keeping your time horizon as narrow as possible.

And now, on to the numbers...

Dow Jones Industrial Average, S&P and Nasdaq futures

Futures on the Dow Jones Industrial Average (INDEXDJX:.DJI) are nearly 56 points below breakeven.

Market Statistics

The Chicago Board Options Exchange (CBOE) saw 955,063 call contracts traded on Friday, compared to 621,648 put contracts. The resultant single-session put/call ratio jumped to 0.65, while the 21-day moving average remained at 0.60.

NYSE and Nasdaq summary

Volatility indices

From the Trading Floor

"Tensions are growing in Russia and Crimea, while bonds and metals are rallying here," continued Sapp. "However, the CBOE Volatility Index (VIX) closed in the red on Friday -- and near the lower end of its range. This is a contrarian bearish signal, as demand for puts on the SPX is obviously low right now. This could be a sign of complacency in the face of a potential geopolitical situation."

Currencies and Commodities

  • The U.S. dollar index is sticking close to the flat line this morning, with the currency last seen fractionally lower at 79.51.
  • Elsewhere, crude oil is on pace to reclaim its footing atop the century mark, with the commodity up 0.5% at $100.25 per barrel.
  • Gold is higher, as well, with the malleable metal flirting with a 0.7% lead to trade at $1,311.70 an ounce.
Currencies and commodities

Earnings and Economic Data

The ISM non-manufacturing index for April will be announced today. PFE, American International Group (AIG), Anadarko Petroleum (APC), EOG Resources (EOG), Hecla Mining (HL), Orbitz Worldwide (OWW), Papa John's (PZZA), PetMed Express (PETS), RetailMeNot (SALE), Solazyme (SZYM), Sturm, Ruger & Company (RGR), Sysco (SYY), Tyson Foods (TSN), and VIVUS (VVUS) will report quarterly earnings.

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