RTTNews - U.S. stocks are set to open Tuesday morning on a slightly positive note as traders await earnings to gather further momentum following recent gains. Traders may also look to Capitol Hill where Fed Chairman Bernanke would be testifying on semi-annual monetary policy.
As of 6.15 am ET, the Dow Futures were up 5.00 points, the S&P Futures were up 0.60 points, and the Nasdaq 100 futures were up 1.00 point.
Monday, stocks continued their northward march and ended sharply higher after reports suggested that lender CIT Group has succeeded in securing a $3 billion loan from a group of its major shareholders. The company confirmed the reports after the markets closed. Positive earnings results from Halliburton (HAL), M&T Bank Corp. (MTB), Hasbro (HAS), Eaton (ETN) and Johnson Controls (JCI), as well as better-than-expected economic numbers lifted trader sentiment.
A report released from the Conference Board revealed that its index of leading economic indicators increased by 0.7% in June following an upwardly revised 1.3% increase in May. Economists had expected the index to increase by 0.5% compared to the 1.2% increase originally reported for the previous month.
Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, in a speech, predicted modest growth starting in the second half of the year, though he said there is not likely to be a strong recovery in the medium term.
The rally in the market was broad based, with almost all the major sectors posting gains. Biotechnology, airline, gold, steel, commercial real estate, railroad, internet, housing and brokerage stocks ended in positive territory, while the laggards included some banking stocks and health insurance stocks.
The Dow advanced by 104.21 points or 1.2% to 8,848, the Nasdaq climbed by 22.68 points or 1.2% to 1,909 and the S&P 500 rose by 10.74 points or 1.1% to 951.
While the underlying optimism about recovery prospects is strong, traders may pause for locking in gains on a relatively light day on the economic calendar. Federal Reserve Chairman Ben Bernanke is set to deliver his semi-annual monetary policy testimony to the House Financial Services Committee in Washington.
On the earnings front, focus will shift to sectors other than technology and banking, with Caterpillar (CAT), Dupont (DD), Lockheed Martin (LMT), Merck (MRK), Southwest Airlines (LUV) and State Street Corporation (STT) scheduled to release results before the market opens today. The technology space may show some tentativeness ahead of the release of quarterly results by Apple (AAPL), Yahoo (YHOO) and Advanced Micro Devices (AMD), all scheduled to report after the markets close.
Texas Instruments Inc. (TXN) said Monday that its second quarter earnings fell 56% from last year, hurt by lower revenue and gross margins. However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations. The company also forecast third-quarter earnings above analysts' current Consensus estimates.
Medical device maker Boston Scientific Corp. (BSX) said its second-quarter profit increased from last year, driven by higher sales, the absence of divestiture-related losses and acquisition-related charges, which lowered year-ago results.
Asset management firm Legg Mason Inc. (LM) swung to a profit in the first quarter, notwithstanding a decline in revenues, helped by significantly reduced operating expenses and rising equity markets.
Heart valve maker Edwards Lifesciences Corp. (EW) reported a jump in second quarter profit, as share gains across all regions drove double digit growth in heart valve therapy.
In other corporate news, struggling Internet search engine Yahoo Inc. (YHOO) revealed that it would launch its new homepage in the U.S later in the day, ahead of its earlier plan of a fall launch. The new homepage is reported to be more easy on the eye than the previous one and said to include several additional features.
Light sweet crude oil for August delivery is currently trading at $64.21, up $0.23 from its previous close in New York at $63.98 on Monday. The dollar continues to weaken against the Euro and the pound, but is advancing against the yen on increasing appetite for risk in the market.
The European markets continue their northward march for the seventh successive session, led by retail, metal and mining stocks on increasing hopes of recovery. The CAC-40 Index in France is gaining 0.83%, the DAX Index in Germany is advancing 0.95% and the FTSE Index in the UK is rising 0.65%.
Mixed trading was witnessed among the Asian markets as traders preferred to lock in gains following the smart gains in the past few trading sessions. While the markets in China, Hong Kong, India and Singapore ended in negative territory, the markets in Australia, South Korea, Japan and Taiwan ended in positive territory but off the day's high.
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