U.S. stock futures lower after HP earnings; Dow down 0.3%

Investing.com - U.S. stock futures pointed to a lower open on Tuesday, pausing after the previous day’s rally as investors looked ahead to a number of key corporate earnings reports before the opening bell, as well as data on housing starts and building permits.

Ahead of the open, the Dow Jones Industrial Average futures pointed to a loss of 0.3%, S&P 500 futures signaled a 0.2% decline, while the Nasdaq 100 futures indicated a 0.25% drop.

U.S. markets rallied on Monday as sentiment was boosted after U.S. Congressional leaders said talks with President Barack Obama to avert the fiscal cliff, a combination of automatic tax increases and spending cuts due to come into effect on January 1, were "constructive."

There are fears the U.S. economy will fall back into a recession, unless a divided Congress and the White House can work out a compromise in the six weeks left before the January 1 deadline.

But sentiment took a hit Tuesday after ratings agency Moody’s downgraded France’s AAA-rating by one notch to AA1 and kept a negative outlook on the rating, citing weakening growth prospects for the euro zone’s second-largest economy.

The downgrade followed a similar move by Standard & Poor’s several months ago, leaving Fitch Ratings as the only ratings firm to keep France at triple-A.

Investors now looked ahead to of a meeting of euro zone finance ministers later in the day in Brussels to discuss whether Greece can receive its next installment of bailout funds.

In earnings news, Hewlett Packard saw shares tumble 8% in pre-market trade after reporting fourth quarter revenue of USD29.96 billion, below estimate for sales of USD30.5 billion.

Other companies releasing corporate earnings on Monday included, Best Buy, Campbell Soup and Salesforce.com.

On the upside, shares in Research in Motion jumped 4.8% after Jefferies upgraded the stock to hold.

Green Mountain Coffee Roasters saw shares add 3.2% after the company named former Coca Cola executive Brian Kelley as president, chief executive officer, and board member effective December 3.

Later in the day, the U.S. was to publish official data on building permits and housing starts, while Federal Reserve Chairman Ben Bernanke was to speak at an event in New York.

Across the Atlantic, European stock markets were lower, as investors looked ahead to a meeting of euro zone finance ministers to discuss a delayed bailout payment for Greece.

The EURO STOXX 50 fell 0.4%, France’s CAC 40 shed 0.4%, Germany's DAX was little chnaged, while Britain's FTSE 100 declined 0.25%.

During the Asian trading session, Hong Kong's Hang Seng Index slumped 0.25%, while Japan’s Nikkei 225 Index eased down 0.1%.

Markets in Japan turning lower after the Bank of Japan refrained from announcing fresh easing measures at the conclusion of its November policy meeting earlier in the day.