Stock index futures pointed to a higher open on Friday, spurred by positive economic data from Europe, as investors awaited a U.S. report on existing home sales and a speech by Federal Reserve Chairman Ben Bernanke on the lessons from the financial crisis.
Purchasing managers indexes showed the German and French private sectors probably returned to growth in August, a week after data indicated the European heavy-weights pulled out of recession in the second quarter.
Banks and other cyclical stocks gained before the bell. Citigroup Inc
Europe is rallying off the PMI, which is sending our futures higher, said Dave Rovelli, managing director U.S. equity trading at Canaccord Adams in New York. Rovelli said the equity market was likely to track higher in low volumes, with added volatility caused by the expiration of options.
At a time when investors are searching for signs that the nascent U.S. housing recovery is gathering momentum, a National Association of Realtors survey is expected to show sales of existing homes likely rose to their highest level in 10 months in July, according to a Reuters poll.
Economists surveyed by Reuters predicted sales of previously-owned homes climbed to a seasonally adjusted annual rate of 5 million in July from 4.89 million units in June.
Bernanke is scheduled to speak to a gathering in Jackson Hole, Wyoming, on the lessons learned from the financial crisis and efforts to aid the economic recovery. Investors will scour his speech for clues into the Fed's thinking on the economy.
Bernanke's speech and the housing data are due at 10 a.m.
S&P 500 futures rose 6.70 points, and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 43 points, and Nasdaq 100 futures were up 7.25 points.
J.M. Smucker Co
In news that hit shares in Japanese automakers overnight, the popular U.S. government cash-for-clunkers program, offering rebates of up to $4,500 to car buyers trading in older, fuel-thirsty vehicles, will end on Monday, the Transportation Department said.
In a potential lucrative joint truck venture, Caterpillar Inc
(Editing by Padraic Cassidy)