Overseas strength lifts U.S. markets
David Russell | [email protected]
S&P 500 futures are up more than 0.4 percent, following gains of similar magnitude in Germany and France. Markets were especially strong in Asia, where the Shanghai Composite soared 2.6 percent on reports the government would announce measures to boost share prices, following a protracted selloff in that index. Hong Kong's Hang Seng rose more than 1 percent.
In Europe, attention is focusing on Spain, where Prime Minister Mariano Rajoy is expected to announce budget proposals that will make a bailout possible. The anticipated move, which will include spending cuts of more than 30 percent for some government ministries, comes in the face of anti-austerity protests in his own country and in Greece.
Overseas economic news was mixed, with Britain revising higher its estimate for the second-quarter gross domestic product and reporting a big income gain. Chinese industrial profits, on the other hand, dropped 6.2 percent in August, which was the worst reading so far this year.
Commodities are also leading the indexes higher today. Oil is higher by almost 1 percent, while copper and silver both advanced by half a percent. Gold is posting a small gain, while natural gas is up by more than 1 percent. Most agricultural commodities are down slightly, while gasoline is up more than 1.5 percent.
Trading is relatively muted in the currency-exchange market, with the euro down slightly against the U.S. dollar, and the Japanese yen slightly higher. Although that would normally be consistent with caution, the Australian dollar and Canadian dollar are both climbing, which reflects some risk appetite by investors.
The S&P 500 has been steadily trending higher since the spring and consolidating above a key resistance level from mid-2008. So far it has shown no warning signs of a correction, while volatility has remained extremely low. That could be leading some chart watchers to believe that stocks will continue to advance.
In company-specific news, recreational-vehicle maker Thor Industries is up about 13 percent after reporting strong results. Medical diagnostics company Cepheid dropped about 3 after predicting that third-quarter revenue will lag estimates.
Today's economic calendar is busy, with weekly initial jobless claims, second-quarter GDP and August durable-goods orders to be announced.