LONDON (ShareCast) - The old adage about 'buy on the rumour, sell on the fact' looks set to prove wise again, as US markets, which shot up yesterday in expectation of an election victory for President Obama, are expected to fall off a cliff - specifically, a 'fiscal cliff' - in the wake of Obama's triumph.
Now that the election is out of the way, with the status quo also largely maintained in the Senate and in Congress, markets can go back to fretting about the looming fiscal cliff - the $600bn or so of automatic tax rises and spending cutbacks that will kick in at the end of the year if Democrats and Republicans cannot reach agreement on budget deficit reduction measures.
If that threat is not enough to send President Obama greyer still, dedicated pessimists always have the Eurozone crisis to turn to for a spot of fear and loathing. Latest reports indicate that the Greek parliament is expected to vote on the government´s proposed new austerity measures this evening, towards 22:00 London time. Nevertheless, different votes are scheduled to take place throughout the entire day in Greece.
Spread betting quotes are changing rapidly, but shortly before 14:00 they were indicating the Dow Jones (DJI: ^DJI - news) 30-share index would open more than 100 points down on last night's close of 13,246 while the broader-based S&P 500 (SNP: ^GSPC - news) is in line to open around 1,418, down 10 points.
Turning to the corporate scene, renewable products company Amyris (NasdaqGM: AMRS - news) is set to defy the weaker trend after announcing a third quarter loss that was not as bad as feared.
Media (Berlin: GC8.BE - news) giant Time Warner (NYSE: TWX - news) may also be in favour after third quarter results came in ahead of expectations. Earnings per share of 86 cents were four cents higher than the market had been expecting.
Canned cheese maker Kraft Foods (NYSE: KFT - news) , which carried off confectionery company Cadbury in 2009 in a smash-and-grab raid, has released its first set of results since spinning off its Mondelez International business. Earnings per share of 79 cents were well up on the 40 cents racked up in the third quarter of last year.
Department store Macy's topped market expectations with its third quarter earnings per share (EPS) of 36 cents; analysts covering the stock had pencilled in a figure of 29 cents.
Canadian lager brewer Molson Coors also beat expectations with underlying EPS of $1.37 versus expectations of $1.34.