Negative Sentiment Generated By Continued Policy Uncertainty

(RTTNews) - The major U.S. index futures are pointing to a notably lower opening on Wednesday, with stocks likely to see further downside following the weakness seen at the close of the previous session. Weakness in the overseas markets is likely to weigh on Wall Street as traders express disappointment with a vague communique issued by China's Communist Party. Traders also continue to express uncertainty about the outlook for the Federal Reserve's stimulus program amid another quiet day on the U.S. economic front.

U.S. stocks experienced another lackluster session on Tuesday, ending mostly lower for the day amid a lack of any major domestic catalysts to drive trading. The major averages opened lower and fell further in early afternoon trading. However, the averages trimmed some of their losses over the course of the afternoon.

The Dow Industrials ended down 32.43 points or 0.21 percent at 15,751 and the S&P 500 Index closed 4.20 points or 0.24 percent lower at 1,768, while the Nasdaq Composite ended at 3,920, up 0.13 points.

Seventeen of the thirty Dow components closed lower, with Travelers (TRV), Chevron (CVX) and Disney (DIS) leading the slide. On the other hand, Merck (MRK), Intel (INTC) and Home Depot (HD) rose notably.

Gold, oil service and banking stocks were among the worst performers of the session.

The Dow Industrials is trading just shy of its all time closing high. Given the lack of catalysts, the index may continue to trade around current levels. Upward resistance for the index lies around 15,800, while on the downside, the index has support around the 15,680, 15,623 and 15,549 levels.

Commodities, Currency Markets

Crude oil futures are rising $0.21 to $93.25 a barrel after tumbling $2.10 to $93.04 a barrel on Tuesday. An ounce of gold is currently valued at $1,276.20, up $5 from the previous session's close of $1,271.20. On Tuesday, gold fell $9.90 an ounce.

Among currencies, the U.S. dollar is trading at 99.42 yen compared to the 99.64 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.3444 compared to yesterday's $1.3436.

Asia

The major Asian markets declined across the board amid risk aversion, as stimulus and growth fears engulfed the markets. Many of the major averages in the region ended down over 1 percent each.

Japan's Nikkei 225 average languished below the unchanged line for the better part of the session before closing down 21.52 points or 0.15 percent at 14,567. Construction stocks Obayashi, Kajima and Shimizu declined sharply in the session. Some defensive sectors such as telecom, utility and pharmaceutical stocks also came under selling pressure. On the other hand, Pioneer rallied 21.69 percent. Resource and export stocks also saw some strength.

Australia's All Ordinaries opened unchanged line but declined steadily in early trading before moving sideways until the mid-session. The index saw further downside in the afternoon and ended 69.30 points or 1.29 percent lower at 5,318. Energy, financial, material and utility stocks were among the worst decliners of the session.

Hong Kong's Hang Seng Index closed at 22,464, down 437.58 points or 1.91 percent, and China's Shanghai Composite lost 38.83 points or 1.83 percent before closing at 2,088.

On the economic front, a report released by Westpac and the Melbourne Institute showed that Australian consumer confidence rose 1.9 percent month-over-month in October following a 4.7 percent drop in September.

The Bank of Japan reported that its index measuring corporate goods prices edged down 0.1 percent month-over-month in October, while economists expected a 0.2 percent drop. Annually, prices were up 2.5 percent, in line with estimates.

A Cabinet Office report said that Japanese core machine orders fell 2.1 percent month-over-month in September, steeper than the 1.8 percent drop forecast by economists.

Europe

European stocks have also shown notable moves to the downside on the day. While the U.K.'s FTSE 100 Index has tumbled by 1.6 percent, the French CAC 40 Index and the German DAX Index are both down by 1.1 percent.

In corporate news, GDF Suez reported a decline in its profits for the nine month period, while the company maintained its full year guidance. German utility E.ON also reported lower nine-month profits, although the decline was not as steep as expected. The company narrowed its guidance for the full year.

On the economic front, data released by the U.K. Office for National Statistics showed that U.K. claimant count fell by 41,700 month-over-month in October, while economists expected a smaller drop of 30,000. The unemployment rate fell to 7.6 percent in the July to September period compared to the 7.8 percent rate in the three months ended in June. The jobless rate was in line with expectations.

Eurostat reported that eurozone industrial output fell 0.5 percent month-over-month in September, reversing the 1 percent increase in August. Economists expected a 0.3 percent drop for the month.

U.S. Economic Reports

The Energy Information Administration is scheduled to release its weekly oil inventory report for the week ended November 8th at 10:30 am ET.

Crude oil stockpiles rose by 1.6 million barrels to 385.4 million barrels in the week ended November 1st. Inventories were above the upper limit of the average range for this time of the year.

Meanwhile, distillate stockpiles declined by 4.9 million barrels and were at the lower limit of the average range. Gasoline inventories fell by 3.8 million barrels and yet were in the upper half of the average range.

Refinery capacity utilization averaged 86.6 percent over the four weeks ended November 1st compared to 86.3 percent over the four weeks ended October 25th.

The Treasury will unveil its monthly budgetary statement at 2 pm ET. Additionally, the Treasury is scheduled to release the results of its auction of 10-year notes.

Federal Reserve Chairman Ben Bernanke is due to address a town hall meeting with educators in Washington at 7 pm ET.

Stocks in Focus

Department store chain Macy's (M) reported third quarter earnings of 47 cents per share compared with 36 cents per share a year ago. The company also said sales rose 3.3 percent to $6.28 billion. The results exceeded analyst estimates. Macy's also reaffirmed its full-year earnings guidance.

SINA (SINA) reported third quarter non-GAAP earnings of 42 cents per share compared to 17 cents per share last year. Net revenues climbed to $468.1 million from $390.2 million in the year-ago period. For the fourth quarter, the company expects non-GAAP revenues of $190 million to $194 million. The results exceeded estimates and the guidance was positive.

MBIA (MBI) reported third quarter earnings of 67 cents per share, higher than 4 cents per share in the year-ago period. Total revenues climbed to $420 million from the year-ago quarter's $281 million.

YRC Worldwide (YRCW) reported a third quarter loss of $4.45 per share, wider than the net loss of $4.30 per share in the year-ago quarter. Operating revenues rose slightly to $1.252 billion. The results trailed expectations.

Diodes (DIOD) reported third quarter non-GAAP earnings of 33 cents per share, up from 20 cents per share in the year-ago period. Revenues rose 4.7 percent to $224.5 million. For the fourth quarter, the company expects revenues of $205 million to $220 million. The results trailed expectations and the guidance was also weak.

Parkway (PKY) announced a 25 percent increase in its quarterly dividend to $0.1875 per share.

Office Depot (ODP) announced the appointment of Roland Smith as its Chairman and CEO, effective immediately.

Polaris Industries (PII) announced that it has purchased all of Fuji Industries' 3.96 million shares of Polaris for a purchase price of $497.5 million. Polaris funded the purchase with a combination of cash on hand and $250 million of borrowings under its revolving credit facility.

Cisco Systems (CSCO), NetApp (NTAP) and Netease.com (NTES) are among the companies due to release their quarterly results after the close of trading on Wednesday.