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TheStreet Open House

Stock Futures Jump on Solid Earnings, Spanish Bond Auctions


NEW YORK ( TheStreet) -- Stock futures were pointing to a higher open early Tuesday after a round of solid earnings reports and successful Spanish bond auctions.

Futures for the Dow Jones Industrial Average were gaining 80 points, or 69.6 points above fair value, at 12,930. Futures for the S&P 500 were up 9.9 points, or 8.5 points above fair value, at 1374. Futures for the Nasdaq were rising 14 points, or 11.8 points above fair value, at 2678.

Monday's action was mixed as robust retail sales data drove a rebound in the Dow, but the S&P 500 barely budged and heavy selling in the tech sector, most notably Apple ( AAPL ), clipped the Nasdaq.

Consumer goods and drug giant Johnson & Johnson (JNJ) topped Wall Street's view, posting first-quarter adjusted earnings of $3.8 billion, or $1.37 a share. The performance topped year-earlier earnings of $3.7 billion, or $1.36 a share. Analysts, on average, were calling for earnings of $1.35 a share.

Global consumer sales at J&J totaled $3.6 billion, down 2.4% from last year. U.S. sales fell 2.2% and international sales declined 2.5%. Shares of J&J were up 0.5% at $64.30 in premarket trading.

Coca-Cola (KO), the beverage giant, reported first-quarter net income of $2.05 billion, or 89 cents a share, up from year-earlier earnings of $1.9 billion, or 82 cents. The company's first-quarter net operating revenue was $11.1 billion.

Coca-Cola's volume increased 5% in the first quarter with 20% volume growth in India and 9% growth in China. Coca-Cola was expected by analysts Tuesday to post first-quarter profit of 88 cents a share on revenue of $10.82 billion. Shares of Coca-Cola were rising 1.1% at $73.23.

Goldman Sachs (GS) posted better-than-expected first-quarter earnings of $2.1 billion, or $3.92 a share, beating the $3.55 a share expected by analysts polled by Thomson Reuters, but falling from earnings of $4.38 a share last year.

Goldman's earnings narrowly beat estimates driven by aggressive cost-cutting and strong investment banking and trading revenues, though revenue fell throughout most of the firm's businesses. Goldman also said it plans to increase its quarterly dividend to 46 cents per share from 35 cents. Shares were trading sideways at $117.85.

Dow components IBM (IBM) and Intel (INTC) are due to report their quarterly results after the closing bell.

Another high-profile report later Tuesday will be Yahoo! (YHOO) but investors may pay more attention to any update CEO Scott Thompson provides on the conference call about recent restructuring efforts. Thompson unveiled plans earlier this month to lay off 2,000 employees, or 14% of the work force, and realigned Yahoo! into three divisions.

In economic news, the Department of Commerce reported that March housing starts fell 5.8% in March to a 654,000 annual rate, which was light on the expectations for a 705,000 rate according to a survey by Thomson Reuters, and the lowest pace since October. Building permits, however, jumped 4.5% in March to a 747,000 rate, greater than the 710,000 rate forecast by economists polled by Thomson Reuters.

London's FTSE was up 0.8% and Germany's DAX was up 1.8% with the easing of eurozone debt contagion fears on a good Spanish bond auction following an unexpected jump in investor sentiment.

On Tuesday, Spain's short-term bond auctions raised more money than expected , while the ZEW Center for European Economic Research in Mannheim said its index of German investor and analyst expectations increased to a far better-than-expected 23.4 from 22.3 in March -- the fifth consecutive gain and the highest reading since June 2010, despite deep problems in the peripheral nations.

Earlier in Asia, Japan's Nikkei Average finished flat and Hong Kong's Hang Seng index had closed down 0.2% as investors got jittery about upcoming Spanish bond auctions.

May oil futures were up 63 cents to $103.56 a barrel, while June gold futures were rising $5.60 at $1,655.30 an ounce.

The benchmark 10-year Treasury was falling 6/32, boosting the yield to 2%, while the U.S. dollar index down 0.1%.


-- Written by Andrea Tse in New York.



>To contact the writer of this article, click here: Andrea Tse.

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