U.S. stock futures edge lower with Lehman, AIG in spotlight

By Daniel | June 16, 2008

U.S. futures edge lower with Lehman, AIG in view

By Steve Goldstein, MarketWatch

Last Update: 6/16/2008 8:23:00 AM

LONDON (MarketWatch) — U.S. stock futures moved slightly lower on Monday as
investors await the opportunity to pore over an expected $2.8 billion loss from
Lehman Brothers and react to American International Group ousting Martin Sullivan
as chief executive.

S&P 500 futures fell 0.80 points to 1,358.90 while Nasdaq 100 futures slipped 5
points to 1,969.50. Dow industrial futures fell 9 points.

U.S. stocks climbed on Friday, helped by data showing in-line core inflation. The
Dow industrials jumped 165 points, the S&P 500 rose 20 points and the Nasdaq
Composite added 50 points to close a volatile week.

Reports that Saudi Arabia’s King Abdullah told the United Nations
Secretary-General Ban Ki-moon that the country would boost production by 500,000
barrels a day, failed to put a dent in oil futures.

Crude futures rose 44 cents to $135.30 a barrel.

Monday brings a measure of manufacturing activity in the New York region, with
the Empire State Index expected to weigh in at -1.0 in June from -3.2 in May, and
net foreign security purchases figures for April also will be released.

Federal Reserve Chairman Ben Bernanke is due to speak at a Senate Finance
Committee health summit, and Richmond Fed President Jeffrey Lacker, who doesn’t
vote on interest-rate decisions, will be speaking on the economic outlook.

In the afternoon, the latest housing market index from the National Association
of Home Builders will be released.

The dollar fell against the euro, but was broadly flat against the yen. The euro
gained 0.5% at $1.5462.

Of stocks in the spotlight, Lehman Brothers (LEH) is expected to provide more
detail on its second-quarter performance, in which the struggling investment bank
said it may have lost $2.8 billion.

AIG (AIG), a component of the Dow Jones Industrial Average, ousted CEO Martin
Sullivan and replaced him with Chairman Bob Willumstad, the ex-Citigroup
executive. Willumstad said in a statement that the insurer will conduct a
“thorough strategic and operational review.”

Barclays (BCS) surged in London trade as the bank said it may sell shares.
Reports indicated that it’s in talks to sell stakes to sovereign wealth funds at
a premium to Friday’s price.

Outside of financials, the staff of the Federal Communications Commission
recommended approval of the planned deal between XM Satellite Radio (XMSR) and
Sirius Satellite Radio (SIRI), according to a report in The Wall Street Journal.

Sirius shares jumped 12% in pre-market trade.

Republic Services (RSG) said it’s in talks to buy Allied Waste Industries (AW)
for $6.6 billion in stock.

ASM International (ASMI) shot up in Dutch trade as the chip equipment maker
rejected an Applied Materials (AMAT) offer for two divisions but said it was open
to talks.

Textron (TXT) may see action after saying that weaker profit from its finance
segment will be offset by higher profits at its aircraft and defense businesses.

Overseas, Asia stocks put in a strong advance, with the Nikkei 225 up 2.7% in
Tokyo. More muted action was seen in Europe, with the FTSE 100 down 0.2% in
London.

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