Pre-Market Report: Stocks Headed Lower

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 |  Includes: AKS, AMD, AMTD, AVGO, BK, CAT, COH, DD, ELX, HBAN, IBM, KO, LXK, MRK, THC, UTX, YHOO
by: Midnight Trader

U.S. PRE-MARKET INDICATORS

-Dow Industrial futures down 65 points.

-S&P 500 futures down 6 points.

-Nasdaq 100 futures down 7 points.

-Nasdaq-100 Pre-Market Indicator down 3.7 at 1305.67

GLOBAL SENTIMENT

Nikkei down 2.4%

Hang Seng down 3%

FTSE down 2%

PRE-MARKET SECTOR WATCH

(-) Large cap tech: mostly lower

(-) Chip stocks: lower

(-,+) Small cap stocks: mixed

(+,-) Drug stocks: mixed

(-,+) Software stocks: mixed

(-,+) Internet stocks: mixed

(-) Financial stocks: lower

(-) Auto stocks: lower

(+,-) Airline stocks: mixed

(-) Retail stocks: mostly lower

DOWNSIDE MOVERS

(-) DuPont (NYSE:DD) (-3.2%) beats by 2 cents, revises FY EPS to straddle Street mean.

(-) Caterpillar (NYSE:CAT) (-5.5%) beats but lowers FY outlook.

(-) Merck (NYSE:MRK) (-4.4%) misses by 3 cents.

(-) Bank of New York Mellon (NYSE:BK) (-7.9%) misses Q1 expectations.

(-) AK Steel (NYSE:AKS) (-1.4%) misses with Q1 sales, loss is narrower than Street expectations.

(-) Huntington Bancshares (NASDAQ:HBAN) (-29%) tumbling after Q1 results disappoint.

(-) Broadcom (BRCM) (-8.9%) reports GAAP loss but guides above Street, makes offer for Emulex.

(-) IBM (NYSE:IBM) (-2%) continues evening slump that followed revenue miss, guidance confirmation.

(-) Coca-Cola (NYSE:KO) (-1.4%) misses Q1 earnings expectations, revenue shy.

UPSIDE MOVERS

(+) Tenet Healthcare) (THC (+33%) preliminary Q1 results beat.

(+) Emulex (NYSE:ELX) (+42.8%) gets offer from Broadcom (BRCM).

(+) Coach (NYSE:COH) (+8.9%) initiates dividend.

(+) Lexmark (NYSE:LXK) (flat) beats earnings expectations, misses with revs.

(+) TD Ameritrade (NASDAQ:AMTD) (-1%) meets with Q2 earnings, beats with revs and guides in line.

(+) United Technologies (NYSE:UTX) (+1.6%) backs FY guidance range that straddles Street mean.

MARKET DIRECTION

After forfeiting an early pre-market bounce, stock futures remain under pressure, signaling at least a modest continuation of Monday's broad-market slump. Stocks appear to be at least consolidating a hefty six-week bounce from the 12-year lows hit in March.

Financial shares remain heavily traded, downside leaders as Wall Street reconsiders the recent rally in the sector with stress test results looming. Citi (NYSE:C) and Bank of America (NYSE:BAC) top volume tables, both last down near 6%.

Dow components dominated the earnings headlines.

DuPont (DD) lowered its 2009 earnings outlook after reporting a 59% profit fall. Caterpillar (CAT) beat but lowered its full-year guidance. Merck (MRK) cut its estimate for 2009 sales and delayed the filing of a migraine drug.

International Business Machines (IBM) continues its evening decline after it reported a 1% profit fall on a worse-than-forecast 11% sales decline.

Bank of New York Mellon (BK) fell after reporting a profit decline and slicing its dividend.

One of the rare advancers was Coach (COH) after it initiated a dividend.

United Technologies (UTX) is modestly firmer after it reports Q1 EPS of $0.78 compared to $1.03 a year earlier. Ex-items including restructuring costs and a tax benefit, EPS would have been $0.97 compared to $1.05 a year earlier. The Thomson Reuters mean analyst estimate, usually ex-items, was for $0.78, so it's not clear to which figure this best compares. Revenue was down 12% to $12.2 billion, in line with the Street view.

The company backs its FY EPS guidance at $4.00 to $4.50. The Street is at $4.20.

Some M&A news did emerge in pre-market trading as well. Emulex (ELX) got a $9.25/share bid from Broadcom (BRCM).

After the closing bell, Yahoo (NASDAQ:YHOO) and Advanced Micro Devices (NASDAQ:AMD) report results.