Stock Futures Rise as European Anxiety Eases
NEW YORK (TheStreet) -- U.S. stock futures followed the European markets higher Tuesday as Spanish yields, though still at elevated levels, eased after finance ministers reached an agreement on supporting Spain's troubled banks.
Futures for the Dow Jones Industrial Average were rising 35 points, or 46.71 points above fair value, at 12,720. Futures for the S&P 500 were up by 2.3 points, or 4.14 points above fair value, at 1352. Futures for the Nasdaq 100 were up 6.5 points, or 8.09 points above fair value, at 2613.
"The Euro group has agreed to give Spain €30 billion, because you never know when €30billion might not come in handy," noted Paul Donovan, global economist at UBS. "The route for the cash matters. Does Spain end up with the debt on its balance sheet, or is cash passed straight to the banks (retrospectively - initially the money is a government liability)?"
Italian yields were also falling while remaining at high levels amid some expectations that Germany's top court will approve plans to try to more easily disburse eurozone rescue funds."The market is behaving like it is nervously expecting a big event," said Jeff Kleintop, chief market strategist for LPL Financial. "The stock market has been jumpy with frequent reversals in direction." In other European news, the Office for National Statistics said that U.K. factory output increased 1.2% in May. The FTSE in London was rising 0.85% and the DAX in Germany was up 1.3%. Hong Kong's Hang Seng Stock index finished down 0.16% and the Nikkei in Japan closed lower by 0.44% after China reported weak trade data that pointed to more signs of a slowdown in the Asian economic powerhouse. August crude oil futures were down 50 cents to $85.49 a barrel. August gold futures were up $4.60 to $1,593.70 an ounce. The benchmark 10-year Treasury was down 5/32, raising the yield to 1.533%, while the dollar was rising 0.16%, according to the dollar index. The benchmark U.S. stock indices retreated Monday amid nervousness about second-quarter reporting season and rising Spanish bond yields. Aluminum giant Alcoa (AA) kicked off second-quarter earnings season, beating Wall Street estimates by a penny. Sales were $5.96 billion, topping the average analysts estimate of $5.81 billion, according to Thomson Reuters. Shares of Alcoa ticked up 7 cents, or 0.8%, in premarket trading Tuesday to $8.83. Investors at Research In Motion's (RIMM) annual shareholders' meeting Tuesday will be listening for details about the troubled BlackBerry maker's long-term strategy. RIM recently reported a worse-than-expected loss in its first quarter, announced 5,000 job cuts, and said it was delaying its long-awaited BlackBerry 10 technology. RIM shares ticked up 5 cents, or 0.65%, in premarket trading Tuesday to $7.72. Advanced Micro Devices (AMD) said it sees a sequential decrease in revenue of 11% for the second quarter, down from a prior forecast for growth of 3%. The chipmaker cited slow growth in China and Europe as well as weak consumer demand for PCs for the weak outlook. Shares of Advanced Micro Devices fell 10.14% in premarket trading Tuesday to $5.05. Intel (INTC) announced Monday a series of deals totaling $4.1 billion with semiconductor manufacturing specialist ASML Holding (ASML) as the chipmaker looks to boost silicon manufacturing. Intel will invest about $1 billion in ASML's research and development over five years, and will eventually take a $3.1 billion, 15% stake in Netherlands-based ASML.
2012 Stock Predictions and Outlook
|Your one-stop shop for 2012 stock recommendations and market predictions.
>To contact the writer of this article, click here: Andrea Tse.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV