U.S. Stock-Index Futures Drop on Durable Goods, Fannie Mae Loss

Feb. 27 -- U.S. stock-index futures declined after orders for durable goods fell more than forecast in January and Fannie Mae posted a loss that was triple analysts' estimates.

United Technologies Corp. and Boeing Co. led industrial shares lower after the Commerce Department said bookings for products meant to last several years decreased 5.3 percent last month. Fannie Mae, the largest source of financing for U.S. home loans, tumbled after mortgage delinquencies dragged down the value of the company's assets. Intel Corp. slid after JPMorgan Chase & Co. said the world's largest chipmaker is facing weaker- than-expected orders.

Standard & Poor's 500 Index futures expiring in March fell 9 to 1,373.8 at 9:23 a.m. in New York. Dow Jones Industrial Average futures lost 62 to 12,637. Nasdaq-100 Index futures dropped 16.25 to 1,780.5. European stocks fell on concern profits will slump as inflation accelerates, while Asian shares rose.

The durable goods report ``is beating on that theme that the economy is weak and doesn't appear to be improving in the short run,'' said Peter Jankovskis, who helps oversee about $1.25 billion as co-chief investment officer at Oakbrook Investments LLC in Lisle, Illinois. ``That potentially could make the market nervous.''

Awaiting Bernanke

The drop in durable goods orders topped the 4 percent decrease forecast by economists in a Bloomberg survey, spurring concern that the economy has tipped into a recession. Investors awaited Federal Reserve Chairman Ben S. Bernanke's testimony to Congress at 10 a.m. today for further clues on the outlook for the economy and interest rates.

United Technologies, maker of Sikorsky helicopters and Otis elevators, lost 67 cents to $72.62. Boeing, the second biggest commercial jet maker, lost $1 to $84.47.

Fannie Mae tumbled $1.58 to $25.39. The net loss was $3.80 share, compared with profit of $604 million, or 49 cents, a year earlier, Fannie Mae said. Excluding some items, the per-share loss was $3.79, compared with the $1.20 average deficit estimated by analysts in a Bloomberg survey.

Intel retreated 45 cents to $20.24. JPMorgan cut its 2008 and 2009 profit estimates, saying slowing personal-computer demand and excess chip inventories will hurt earnings.

Amgen, Johnson & Johnson

Amgen Inc. lost 93 cents to $46.89. Johnson & Johnson, the world's biggest health-products maker, slipped 96 cents to $62.76. A study published in this week's Journal of the American Medical Association found that cancer patients who take anemia drugs sold by the companies have a 10 percent higher risk of dying than those who didn't take the treatments.

The risks of the anemia drugs are ``well-defined,'' and the newly published analysis ``looks exactly like what we've seen before,'' Roger Perlmutter, Amgen's head of research and development, said in an interview.

Microsoft Corp. fell 17 cents to $28.21 after European Union regulators fined the world's largest software maker a record 899 million euros ($1.35 billion) for failing to comply with a 2004 antitrust order. It's the largest EU fine ever imposed against a single company.

Autodesk Inc. dropped $4.85 to $34.25. The software maker reported fourth-quarter profit, excluding compensation and acquisition costs, of 52 cents a share. That missed the 54-cent average of analysts' estimates.

European stocks fell today after HBOS Plc, the UK's biggest mortgage lender, said corporate lending and profit margins are declining and earnings from Bouygues SA, the world's second- largest construction company, trailed analysts' estimates.

U.S. stocks climbed for a third day yesterday, boosted by International Business Machines Corp.'s $15 billion buyback, higher retail earnings and rising commodity prices.