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US STOCKS-Futures slide on Syria tension, J.C. Penney shares fall
August 27, 2013 / 12:11 PM / 4 years ago

US STOCKS-Futures slide on Syria tension, J.C. Penney shares fall

* NYSE, Nasdaq at odds over cause of last week’s outage

* J.C.Penney shares drop as top shareholder exits investment

* Home prices, consumer confidence data due

* Futures down: Dow 88 pts, S&P 11 pts, Nasdaq 24 pts

By Rodrigo Campos

NEW YORK, Aug 27 (Reuters) - U.S. stock index futures fell on Tuesday on rising tension over a possible military response to a chemical weapons attack against Syrian civilians last week.

U.S. Secretary of State John Kerry on Monday laid the groundwork for possible action against Syrian President Bashar al-Assad’s government, calling for accountability over what he called a “moral obscenity.”

Kerry’s words triggered a flight to safety in financial markets, with U.S. stocks turning lower in the last hour of trading on Monday. Asian stocks fell overnight and European shares were sharply lower despite a 16-month high in a measure of German business sentiment.

“Syria and the reactions around it are going to be a huge driver to markets today,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

“This could be more serious than Iran or Iraq because it’s bringing in Russia, and that complicates things tremendously,” she said.

The U.N. Security Council has been deadlocked on Syria since 2011. Russia and China have vetoed three resolutions condemning Assad and calling for punitive steps against his government.

Gold prices hit an 11-week high and the yen rose as the geopolitical tension lured investors towards safe-haven buying.

S&P 500 futures fell 11 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures fell 88 points, and Nasdaq 100 futures lost 24 points.

Five days after a glitch that paralyzed Nasdaq-listed stocks for three hours on all U.S. markets, Nasdaq OMX and NYSE Euronext have a different understanding of what happened in the period preceding and during the blackout, with each side blaming the other for the outage, according to sources.

Shares of J.C.Penney fell 3 percent in premarket trading a day after hedge fund manager William Ackman, the biggest share holder, said he had sold his entire stake after his campaign to overhaul the retailer failed.

Richard Schulze, the founder and largest shareholder of Best Buy, said in a regulatory filing he plans to start selling its stock this fall.

Shares of Tiffany & Co rose 2.2 percent in premarket trading after the U.S. jeweler reported a higher quarterly profit and raised its full-year forecast.

Data due Tuesday includes the S&P Case/Shiller home price index for June at 9 a.m. (1300 GMT). Economists in a Reuters survey expect a rise of 1 percent, a repeat of the May increase. The Conference Board releases consumer confidence for August at 10 a.m. (1400 GMT).

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