Futures Edge Up as Euro Leaders Near Debt Plan

NEW YORK ( TheStreet) -- U.S. stock futures edged up on Monday after data suggested an expansion in Chinese manufacturing and as Europe's leaders inched closer to a comprehensive debt plan.

Futures for the Dow Jones Industrial Average were up 34 points, or 36 points above fair value, at 11,788. Futures for the S&P 500 were up 2.3 points, or 3.4 points above fair value, at 1238, and Nasdaq futures were rising 7 points, or 9 points above fair value, at 2341.

European leaders continue to try to hammer out a comprehensive plan to stem the region's debt crisis, which they hope to finalize at a summit on Wednesday. So far, banks will likely have to raise about 100 billion euros, or $140 billion to bolster their capital and take a 40% to 60% write down on Greek debt. Progress on increasing the firepower of the rescue fund remains vague as leaders meeting over the weekend ruled out using the European Central Bank to expand the fund.

Skepticism remains over whether Germany and France can overcome their disagreements about who should bear the burden of helping more trouble nations. "There's no guarantee that this latest plan will work but at least the leaders being realistic," said Jim Maguire, floor trader with NativeOne Institutional Trading. "Since the market has been anticipating where things are going on Europe, it could flat line or sell off a little bit if a plan comes out on Wednesday."

The Dow has gained 10% over the past four weeks, helped by optimism over Europe and bright spots in U.S. earnings. Some 191 companies of the S&P 500 are expected to report quarterly results this week.

In Europe, a reading on manufacturing in Germany fell to its lowest level since July 2009. Even so, London's FTSE was gaining 0.13% while Germany's DAX was up 0.29%. Asian markets rose, encouraged by data showing expansion in China's manufacturing sector. Japan's Nikkei Average finished 1.9% higher, and Hong Kong's Hang Seng jumped 4.14%.

Caterpillar ( CAT) jumped 5.2% in pre market trading after the heavy-machinery maker reported earnings that soared 44% from a year earlier and booked a record revenue for the third quarter. While Caterpillar acknowledged an uncertain economic and political outlook, it said it does not expect a global recession. Earnings per share came in at $1.71, easily topping Thomson Reuters's forecast of $1.54 a share.

In other corporate news, health care management company Cigna ( CI) said it will buy Nashville-based HealthSpring ( HS) for $3.8 billion, or $55 a share in cash. HealthSpring shares surged 33.2% to $53.50 in premarket trading Monday.

Google ( GOOG) is considering bidding for troubled Internet search pioneer Yahoo! ( YHOO), according to a news report. Yahoo! shares added 3.2% to $16.64 while Google shares traded flat at $590.

Mattel ( MAT) said it would buy HIT Entertainment, which owns preschool brands such as Thomas & Friends, Barney and Bob the Builder, for $680 million in cash. Shares of HIT Entertainment rose 2.9% to $28.50.

Ahead of the bell, the dollar index, a measure of the dollar's value against a basket of currencies, was gaining 0.14%. The euro slipped after climbing for four days, down 0.48% against the greenback. The benchmark 10-year Treasury was last gaining 4/32, diluting the yield to 2.18%.

Gold for December delivery gained $18.80 to trade at $1,654.90 an ounce. In other commodities, the December crude oil contract edged up 42 cents to trade at $87.82 a barrel.

-- Written by Chao Deng in New York.