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U.S. Stock Futures Little Changed Before Fed as Retailers Slump

Aug. 20 (Bloomberg) -- U.S. stock futures were little changed, after the Standard & Poor’s 500 Index climbed toward a record yesterday, as companies from Lowe’s Cos. to Target Corp. fell amid weaker forecasts and investors awaited minutes from the Federal Reserve’s last meeting.

Target lost 1.8 percent after reducing its earnings outlook as slumping sales and a money-losing push into Canada take a toll on profit. Lowe’s fell 3.2 percent after trimming its revenue projection for this year. Hertz Global Holdings Inc. slumped 13 percent after saying its full-year results will miss the low end of its forecast.

Futures on the S&P 500 expiring in September slipped 0.1 percent to 1,975.20 at 8:18 a.m. in New York. Dow Jones Industrial Average contracts fell 13 points, or 0.1 percent, to 16,868 today.

“The expectations of investors on the Fed are pretty dovish,” Ralf Zimmermann, an equity analyst at Bankhaus Lampe KG, said in a phone interview. “Whether this will be confirmed by the minutes is another question. Maybe there is more downside risk.”

The S&P 500 is within 0.3 percent of an all-time high amid bets that the Fed will leave interest rates near zero for longer even as economic growth shows signs of accelerating.

The central bank releases minutes from its July 29-30 meeting at 2 p.m. in Washington. At that gathering, the central bank cut bond purchases by $10 billion for a sixth time, leaving it on track to end in October.

Jackson Hole

The annual Fed Bank of Kansas City’s economic symposium starts tomorrow in Jackson Hole, Wyoming. Fed Chair Janet Yellen and European Central Bank President Mario Draghi will discuss their outlook for the economy and monetary policy on Aug. 22.

“Fed minutes reaffirming confidence is what we are looking for,” Justin Urquhart Stewart, who helps oversee about $7 billion at Seven Investment Management LLP in London, wrote in an e-mail. “What we don’t want to see is any significant movement up or down, but rather something showing continued steady growth in the economy.”

Hewlett-Packard Co. and Staples Inc. are among the six S&P 500 companies reporting earnings today. Stocks rallied yesterday as retailers including Home Depot Inc. and TJX Cos. led gains on better-than-projected results.

Target dropped 1.8 percent to $58.18. The retailer’s bleaker forecast follows a preliminary earnings report on Aug. 5 that fell short of expectations, signaling the company’s comeback effort will be slow going. Target has been working to boost U.S. traffic, repair its botched expansion into Canada and regain shoppers’ trust after hackers stole millions of customers’ data last year.

Lowe’s, Hertz

Lowe’s retreated 3.2 percent to $49.85. The second-largest U.S. home-improvement retailer cut its full-year revenue forecast even after second-quarter profit topped analysts’ estimates as sales of appliances and yard merchandise increased.

Hertz slumped 13 percent to $27.50. The company said its performance is being hurt by a record number of auto recalls, higher-than-expected operating expenses in the U.S. rental-car market and sluggish demand for its equipment business.

The car- and equipment-rental company, which is splitting in two, has yet to report financial results from the first or second quarters. It has delayed earnings reports at least four times since it uncovered accounting errors and said it can no longer rely on its past three years of financial statements.

Staples Inc. gained 2.4 percent to $11.90. The office- supply retailer plans to shut about 140 stores in North America this year as it responds to online competition that has hurt sales.

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