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Disney shares slide
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PacWest has $15 bln of liquidity
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Tapestry jumps on profit outlook
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Futures: Dow down 0.28%, S&P off 0.07%, Nasdaq flat
By Shreyashi Sanyal and Shristi Achar A May 11 (Reuters) - Dow futures came under pressure from a drop in shares of Disney after the company reported a decline in subscriber growth, while investors awaited more evidence to see if inflation was cooling.
Data on Wednesday showed consumer prices in April slowed slightly from a year earlier, raising hopes that the Federal Reserve could pause its rate-hike campaign. Market participants will now focus on the Labor Department's Producer Price Index (PPI) for final demand, which is expected to show a 0.3% increase in April, after falling 0.5% in the previous month.
Another report is expected to show that initial claims for state unemployment benefits likely rose to 245,000 in the week ended May 6 from 242,000 in the previous week. Both sets of data are due at 0830 ET (1230 GMT).
Expectations for rate cuts in the second half of the year have lifted the S&P 500 7% from the start of the year and 15% from its October lows.
"While inflation is trending in the right direction, we still see the potential for disappointment among equity investors on the pace of Fed easing in the remainder of this year," said Mark Haefele, chief investment officer, UBS Global Wealth Management.
"U.S. equities are pricing a high probability of a near-perfect outcome for the U.S. economy. Yet tighter financial conditions, declining corporate earnings and relatively high valuations all present risks."
At 7:19 a.m. ET, Dow e-minis were down 93 points, or 0.28%, S&P 500 e-minis were down 3 points, or 0.07%, and Nasdaq 100 e-minis were up 3 points, or 0.02%. Walt Disney Co slid 5.7% premarket after its quarterly report on Wednesday. Streaming giant Netflix Inc's shares were also down 1.1%.
Any updates on raising the United States' $31.4 trillion debt ceiling were also being watched by investors, as the country races to avert an unprecedented default. U.S. Treasury Secretary Janet Yellen urged Congress to raise the federal debt limit and warned that a default could have severe repercussions on the global economy and risked undermining U.S. global economic leadership. Alphabet Inc shares extended gains to rise 1.4% after Google rolled out more artificial intelligence products on Wednesday to take on competition from Microsoft Corp . PacWest Bancorp slipped 12% after the regional bank said it had $15 billion of immediately available liquidity.
Tapestry Inc rose 8.0% as it raised its annual
profit forecast.
(Reporting by Shreyashi Sanyal and SHristi Achar A in
Bengaluru; Editing by Saumyadeb Chakrabarty and Anil D'Silva)
