Stock Futures Rise Modestly on Hopes of Debt-Ceiling Resolution
NEW YORK (TheStreet) -- Stock futures were rising modestly Tuesday on hopes the impasse over debt-ceiling talks in government will be resolved as Senate Majority Leader Harry Reid prepares to unveil a standalone bill to increase the government's borrowing caps.
Reid's bill would allow the U.S. at least $1 trillion in additional borrowing room beyond the $16.7 trillion debt limit expected to be breached on October 17, providing the government with enough borrowing ability to pay its bills through next year's general elections in November.
Yet as the third quarter earnings season begins, investors remain cautious about how the economic uncertainties spurred by the drawn-out fiscal debates in Washington might have impacted corporate earnings outlook.
"If it gets off the ground, it ends the threat of a debt default for the immediate future," said Peter Cardillo, chief market economist at Rockwell Global Capital in Manhattan, in an emailed comment about Senate's expected move. "We think earnings sentiment remains neutral as the political impasse overshadows for now. However, that's not to say individual companies will not be punished," he added.
Futures for the S&P 500 were up 2 points, or 0.43 points above fair value, to 1,669.75. Futures for the Dow Jones Industrial Average were higher by 15 points, or 8.76 points above fair value, to 14,866. Futures for the Nasdaq were up 5.5 points, or 2.96 points above fair value, to 3,210.5.Alcoa (AA) will be reporting after the market close, while JPMorgan Chase (JPM) and Wells Fargo (WFC) will be releasing their quarterly results on Friday. Nuance Communications (NUAN) was popping 2.27% to $18.91 after billionaire activist investor Carl Icahn tweeted that the speech-recognition technology maker's board will bringing on his two of his choices consisting of his son Brett Icahn as well as David Schechter, both of whom are co-managers of Sargon Portfolio which is a component of the private investment funds operating under Icahn Enterprises L.P. Procter & Gamble (PG) was gaining 0.61% to $76.11 after the consumer staples giant was raised to "outperform" from "market perform" by Wells Fargo analysts based on the company's increased productivity and market share, and its decision to bring A.G. Lafley back to the helm. The FTSE 100 in London was down 0.79% and the DAX in Germany was off by 0.26%. The Hong Kong Hang Seng closed higher by 0.89% while the Nikkei 225 in Japan settled up 0.3%. The benchmark 10-year Treasury was falling 5/32, raising the yield to 2.65%. The dollar was rising 0.11% to $80.03 according to the U.S. dollar index. November crude oil futures were rising 81 cents to $103.84 a barrel. December gold futures were down $1.60 to $1,323.50 an ounce. Follow @atwtse -- Written by Andrea Tse in New York >To contact the writer of this article, click here: Andrea Tse.>
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