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U.S. Stock-Index Futures Little Changed Before Earnings Begin

July 8 (Bloomberg) -- U.S. stock-index futures were little changed, after equity gauges dropped from records, as investors weighed valuations before the start of the earnings season.

Alcoa Inc. slipped in Germany before reporting financial results, unofficially kicking off the season. Macquarie Infrastructure Co. rose 5.4 percent late yesterday after agreeing to buy the rest of International-Matex Tank Terminals it doesn’t already own. PHH Corp. added 3.7 percent after saying it will buy back shares. Groupon Inc. advanced 3.7 percent in early trading as B. Riley & Co. recommended buying the stock.

Futures on the Standard & Poor’s 500 Index expiring in September slipped 0.1 percent to 1,968.3 at 6:42 a.m. in New York. Contracts on the Dow Jones Industrial Average lost 17 points, or 0.1 percent, to 16,929. Both the S&P 500 and the Dow retreated from records yesterday amid speculation the Federal Reserve will raise interest rates sooner than expected.

“Equities are near all-time highs and the air will only get thinner,” said Heinz-Gerd Sonnenschein, a strategist at Deutsche Postbank AG in Bonn, Germany. “We need a strong results season now to support equities because investors will keep wondering when the Fed will hike rates and this can bring some nervousness to the market.”

The equity index is trading at 16.7 times the projected earnings of its members, near its highest valuation since the end of 2009 and higher than the five-year average of 14.3.

VIX Jumps

The Chicago Board Options Exchange Volatility Index, the measure known as VIX that tracks investors’ expectations of future volatility, jumped 9.8 percent yesterday from a seven- year low.

The Federal Reserve will release minutes from its June meeting tomorrow. Policy makers trimmed bond purchases last month by $10 billion for the fifth consecutive time, saying economic growth is rebounding and the job market is improving. Officials are debating the timing for the first increase in the main interest rate since 2006.

Alcoa slid 0.6 percent to $14.65. The largest American aluminum producer will report second-quarter earnings after the close of trading today.

Citigroup Inc., JPMorgan Chase & Co., Goldman Sachs Group Inc., Yahoo! Inc. and Johnson & Johnson are among companies reporting financial results in the next week. Profit for S&P 500 members probably climbed 5 percent in the three months through June, while sales rose 3 percent, according to analyst estimates compiled by Bloomberg.

Macquarie Infrastructure rose 5.4 percent to $64.45. The U.S. owner of storage terminals, part of Australia’s Macquarie Group Ltd., will buy the 50 percent stake of International-Matex Tank Terminals it doesn’t already own from the founding family for $1.03 billion in cash and stock, according to a statement.

PHH added 3.7 percent to $24.15. The company intends to buy back as much as $450 million of its own shares, starting after the release of its second-quarter results.

Groupon advanced 3.7 percent to $6.69 as B. Riley upgraded its rating on the stock to buy from neutral. Shares of the provider of daily deals have lost 45 percent this year.

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