By Eric Martin
Oct. 8 (Bloomberg) -- U.S. stock futures fell after metal and oil prices declined, dimming the profit outlook for commodity companies, while concern grew that third-quarter earnings rose at a rate that won't justify this year's rally.
Freeport-McMoRan Copper & Gold Inc., the world's second- largest copper producer, slid after the metal retreated the most in a month. Occidental Petroleum Corp., the fourth-biggest U.S. oil company, declined after crude slumped below $81 a barrel and Friedman, Billings, Ramsey & Co. downgraded the stock.
Analysts estimate third-quarter profits at S&P 500 companies rose an average 0.7 percent from a year earlier, down from a forecast of 3.2 percent growth last month, according to Bloomberg data. Alcoa Inc., the world's second-largest aluminum company, will be the first Dow Jones Industrial Average member to report earnings when it releases results tomorrow.
``The biggest concern is what kind of third-quarter earnings season do we get and what kind of guidance we get for the next quarter,'' said Art Hogan, the Boston-based chief market analyst at Jefferies & Co.
Standard & Poor's 500 Index futures expiring in December lost 4.4 to 1,566.3 at 8:43 a.m. in New York. Dow average futures slipped 14 to 14,142. Nasdaq-100 Index futures decreased 3 to 2,167.75.
U.S. Treasury markets are closed today for the Columbus Day holiday.
Freeport, Occidental
Freeport-McMoRan dropped $1.41 to $109.25. Copper prices declined on speculation a four-week price rally is deterring Chinese buyers from purchasing the metal. Zinc, tin, lead, aluminum and nickel also fell. Gold retreated in London on signs a rebound in the dollar is slowing growth in investor demand for the precious metal.
Occidental slipped 41 cents to $66 after Friedman, Billings, Ramsey analyst Eitan Bernstein downgraded the shares to ``underperform'' from ``market perform'' and oil fell as much as 0.7 percent to $80.67 a barrel.
Oil may decline this week as supplies rise after plants shut down for pre-winter maintenance, according to 75 percent of the analysts surveyed by Bloomberg News on Oct. 5. U.S. crude oil inventories climbed for a second week and were 8.5 percent above their five-year average, the Energy Department said Oct. 3.
American depositary receipts for HSBC Holdings Plc fell $2.01, or 2 percent, to $96.70 after Europe's biggest bank rejected a call from the California State Teachers' Retirement System for an outside strategic review.
Expedia Inc., the world's biggest online travel agency, dropped 83 cents to $34.21 in Germany after Citigroup lowered its recommendation for the shares to ``hold'' from ``buy.''
Last week, U.S. stocks rose, sending the S&P 500 to a record, after employment growth eased concern that mortgage losses will cause a recession. Fannie Mae and Morgan Stanley led banks, brokerages and other financial firms in the S&P 500 to their biggest rally since March 2003. Homebuilders surged the most since November 2000 after Citi Investment Research said their shares are cheap.
Last Updated: October 8, 2007 08:44 EDT
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