1 June 2004, 17:13  US stocks set to slip; Viacom falls before bell

U.S. stocks are set to open lower on Tuesday as investors fret over resurgent oil prices triggered by weekend attacks on the Saudi Arabian oil industry. Viacom Inc. shares dipped before the bell as the media conglomerate said No. 2 executive Mel Karmazin will step down, ending several years of tension with Chief Executive Sumner Redstone. "Oil is the name of the game," said David Hagerty, head of equity trading at Commerzbank Securities in New York. "Equities are acting inversely to oil." World oil prices jumped around $1 a barrel on Tuesday following the weekend attack in Saudi Arabia in which suspected al Qaeda militants killed 22 people linked to the Saudi oil industry. Saudi leaders rushed to reassure the world about security and vowed to keep the oil taps open, but crude prices shot up, wiping out last week's declines.
U.S. stock futures moved in the opposite direction, sinking below fair value, pointing towards a lower open. Viacom shares were heavily traded before the bell, dipping almost 4 percent to $35.48 on the INET electronic brokerage system. Viacom said Karmazin, who has been president and chief operating officer since 2000, will be replaced by two of Viacom's most powerful unit heads, MTV Networks CEO Tom Freston and CBS CEO Leslie Moonves. Other stocks to watch on Tuesday include brewer Anheuser-Busch , which is expected to bid about $720 million for Harbin Brewery Group Ltd <0249.HK> after raising its stake in the Chinese beer maker. Tuesday's economic indicators lead off with Institute of Supply Management's index of U.S. manufacturing activity, due at 10 a.m. (1400 GMT), with economists expecting a slight easing to 62 in May from 62.4 in April. U.S. construction spending in April, forecast to grow 0.4 percent, is also due at 10 a.m. However, investors are more focused on Friday's U.S. employment report, which will help shape perceptions on the timing of a U.S. interest rate hike and market sentiment towards stocks, bonds and currencies.///

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