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U.S. Stock Futures Drop as Internet Stocks Slip Amid Earnings

May 9 (Bloomberg) -- U.S. stock futures fell, with the Standard & Poor’s 500 Index heading for a weekly loss, as Internet stocks slumped and investors assessed corporate earnings.

CBS fell 2.3 percent after posting quarterly revenue that missed analysts’ estimates. LinkedIn Corp. lost 1.4 percent to pace declines in Internet stocks. Pandora Media Inc. dropped 3.2 percent after Apple Inc. was said to have held talks to buy headphones-maker Beats Electronics LLC. Gap Inc. surged 8.6 percent after giving profit guidance. Symantec Corp. rose 2.8 percent as its sales forecast exceeded analysts’ predictions.

Futures on the S&P 500 expiring in June lost 0.2 percent to 1,868.5 at 8:10 a.m. in New York. Dow Jones Industrial Average contracts slipped 27 points, or 0.2 percent, to 16,483 today. Futures on the Nasdaq 100 Index fell 0.4 percent.

“While company earnings may be OK on a quarter-to-quarter basis, a year-on-year comparison will be less advantageous,” Didier Duret, who helps manage about 168 billion euros ($232 billion) as chief investment officer at ABN Amro Bank NV’s wealth-management unit, said by telephone. “With tech stocks, we’re seeing some violent profit taking. It’s an opportunity for investors to reposition.”

The S&P 500 has declined 0.3 percent so far this week amid a rout in Internet stocks such as Facebook Inc. and Amazon.com Inc. The technology-heavy Nasdaq Composite Index has tumbled 1.8 percent this week, its biggest drop in a month.

Earnings Season

Of the 450 S&P 500 constituents that have released results this earnings season, 76 percent have beaten estimates for profit, while 53 percent have exceeded projections for revenue, data compiled by Bloomberg show. The index’s members increased their earnings by 4.6 percent and their sales by 2.8 percent in the first quarter, according to analysts surveyed by Bloomberg.

CBS declined 2.3 percent to $56.65 after the owner of the most-watched U.S. television network said first-quarter sales fell 4.6 percent to $3.86 billion. Analysts had predicted $3.92 billion. Advertising revenue dropped 12 percent in the period.

Pandora slipped 3.2 percent to $21.49. Apple has held advanced talks to buy Beats, which also runs a music-streaming service, for $3.2 billion, according to people familiar with the matter. The Financial Times first reported the discussions late yesterday. A deal to buy the company founded by hip-hop producer Dr. Dre and Jimmy Iovine would be Apple’s biggest-ever deal.

Gap jumped 4 percent to $40.80. The apparel maker said in a preliminary report that profit reached 56 cents to 57 cents a share in the three months through April, exceeding the 53-cent average forecast of analysts surveyed by Bloomberg.

Symantec gained 2.8 percent to $20.70 as the maker of security software forecast first-quarter sales of $1.65 billion to $1.69 billion. Analysts on average had projected $1.64 billion. In the fourth quarter, which ended March 28, net income rose to 31 cents a share from 27 cents a year earlier.

Monster Beverage Corp. added 1.3 percent to $67 after the maker of energy drinks posted first-quarter earnings of 55 cents a share. That beat the 49-cent average of analysts in a Bloomberg survey. It also said sales rose 11 percent to $536.1 million, missing the average analyst forecast of $542.3 million.

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