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Stock futures tumble as global tensions mount

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Stock futures are indicating a lower open for stocks after North Korea test-fired an anti-ship missile last night. While Korean and U.S. officials said the missile was likely a small, conventional one, not the ballistic rocket that U.S. officials fear can possibly hit parts of the western U.S.

However, the testing of the missile, which coincided with the arrival of Secretary of State Colin Powell in Seoul, Korea, raised tensions in a region already jittery from a standoff over North Korea's nuclear program, which U.S. officials say could lead to nuclear weapons production.

Asian/Pacific markets traded lower in today's session with Japan's Nikkei 225 falling 204 points, or 2.39% to 8,360. South Korea's Seoul Composite fell 3.9% to 592.50, while Hong Kong's Hang Seng traded down 0.98% at 9,148.

Stock futures here in the U.S. have S&P 500 futures (sp03h) down 8.9 points, or 1.06% at 823.70. NASDAQ futures (nd03h) are lower by 10.50 points at 983.50, while Dow futures (dj03h) are losing 70 points at 7,790.

Fair value for the S&P 500 today is $-0.16. That price will not change during the session. HL Camp & Company has their computers set for program buying at $0.54 and set for program selling at $-1.58.

In a defensive move, Treasuries are seeing buying across the major maturities. The 10-year Treasury futures (ty03h) $116'035 +0.35% are gaining 13/32 and trading a new contract high, as the benchmark bond's YIELD ($TNX.X) falls to 3.781%.

The U.S. Dollar Index (dx00y) 99.79 +0.13% is edging higher, but showing a rather mixed trade with dollar unchanged versus the euro.

Cisco Systems (NASDAQ:CSCO) $14.42 is the most actively traded stock in this morning's pre-market trade and ticks lower at $14.02, down 2.77%.

Dow component and home improvement retailing giant Home Depot (NYSE:HD) $22.18 is indicating a higher open at $22.50, up 1.4% from yesterday's close after the company reported Q4 ESP (January) of $0.30 per share, which was 3-cents better than consensus estimates. The company said revenues fell 2% year- over-year to $13.2 billion. Home Depot reaffirmed its 2003 outlook for sales growth of 9-12% and EPS growth in the 9-14% range. The company said that beginning with fiscal year 2003, it would provide sales, earnings and other financial forward-looking guidance on an annual basis only.

Federated Department Stores (NYSE:FD) $24.82 reported Q4 (January) EPS of $1.99, which was 4-cents better than consensus estimates. The company said revenues fell 2.2% year-over-year to $5.02 billion, which was just below estimates of $5.04 billion. The company said it expects FY03 earnings per share of $3.05 to $3.25, which is well below the Multex consensus of $3.38 per share.

Jeff Bailey

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