Dow Futures Down 80 Pts; Home Depot Q2 Impresses, Walmart Due By

© Reuters

By Peter Nurse

-- U.S. stocks are seen opening with small losses Tuesday, handing back some of the previous session’s solid gains with quarterly reports from retail giants Walmart (NYSE:WMT) and Home Depot (NYSE:HD) in focus.

At 07:00 ET (11:00 GMT), the Dow Futures contract was down 75 points, or 0.2%, S&P 500 Futures traded 10 points, or 0.2% lower, and Nasdaq 100 Futures dropped 30 points, or 0.2%.

The three main Wall Street indices closed higher Monday, with the blue-chip Dow Jones Industrial Average gaining 0.5%, ending above its 200-day moving average for the first time since late April, suggesting a long-term uptrend.

The retail sector is in the spotlight Tuesday, with both Walmart and Home Depot reporting before the opening bell.

Walmart, the biggest U.S. retailer, is expected to report earnings per share of $1.63 on revenue of $150.9 billion, but the retail behemoth did warn in late July that profits are due to fall in the second half of 2022 amid inflationary impacts.

Home Depot impressed with its quarterly comparable sales, benefiting from steady demand for home-improvement goods from professional builders and handymen.

The July retail sales release is due on Wednesday, and these corporate results could provide indications on the strength of consumer spending after a slowdown in second-quarter growth.

Staying in the corporate sector, Ziprecruiter (NYSE:ZIP) stocks weakened premarket after the employment marketplace lowered its full-year revenue forecast, while Compass (NYSE:COMP) stock slumped 13% premarket after the real estate broker reported a widening second-quarter loss and lowered its 2022 guidance.

As far as the economic data calendar is concerned, this week brings a slate of data on housing trends, another market that is cooling amid high prices and rising interest rates.

Building permits are expected to fall slightly in July, to 1.650 million from 1.696 million, while housing starts are set to drop to 1.540 million in July, from 1.559 million. The data are due at 08:30 ET (12:30 GMT).

Oil prices fell Tuesday, extending recent losses on concerns of a deepening economic slowdown as well as a potential increase in OPEC supply.

Data on Monday showing U.S. manufacturing activity slowed much more sharply than thought over the last month, coupled with bleak industrial production data from top crude buyer China renewed fears of a global recession.

On the supply side, Iran responded positively to the European Union's "final" draft text to save a 2015 nuclear deal on Monday, which could result in the removal of sanctions on Iranian oil exports, while Saudi Aramco (TADAWUL:2222), the world’s largest crude producer, also said it could potentially increase output.

Industry data on U.S. crude stockpiles are due later in the session on Tuesday.

By 07:00 ET, U.S. crude futures traded 0.6% lower at $88.84 a barrel, while the Brent contract fell 1% to $94.16. Both contracts fell around 3% on Monday, touching their lowest levels since early February.

Additionally, gold futures fell 0.3% to $1,791.95/oz, while EUR/USD traded 0.3% lower at 1.0130.

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