Sharp opening slide on tap amid sinking world stocks, profit woes

U.S. stocks are expected to open sharply lower, pulled down by sinking equities in Europe and Asia. In the United Kingdom, economic contraction is the worst since 1980, and the European Stoxx 600 and the Australian stock indices are now at or near 5-year lows. In Asia, chipmakers and electronics firms were taking a hit overnight and here in the United States the latest batch of profit reports was spotty, but overall gloomy. The Dow was expected to open down 130 points, while the Russell 2000 (NYSE:IWM) was seen down about 1.8% near 434.80.

General Electric Co. (NYSE:GE) is often seen as the “national bellwether” for stocks because the company operates in such a variety of businesses. GE’s profit report before the opening today met the forecast and the stock was up in pre-market trading, but it didn’t seem to provide much of a lift to the overall market. Google Inc. (Nasdaq:GOOG) actually beat the estimate and was up a tad ahead of the open, but a majority of the profit stories mirrored the somber news coming out of firms like Harley Davidson Inc. (NYSE:HOG) as the motorcycle maker said it would shutter some operations and layoff 1,100 employees.

Crude oil prices were off about $0.40 a barrel heading toward the open, which could weigh on energy stocks. Foreign currency markets were making sizable moves overnight, with the U.K. pound at long-term lows against the dollar, most FX markets at long-term lows against the yen and the dollar up about 1.6% versus the euro at six-week highs, which could weigh on physical commodity markets this morning.

Looking at the chart structure, this morning’s opening appears set to test a . . .

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