Stocks attempt to stage a rebound
David Russell | [email protected]
S&P 500 futures rose about one-quarter of a percent, while Europe is posting similar gains. The main catalyst for the buyers appears to be coming from Asia, where Tokyo and Shanghai indexes rallied overnight amid positive Japanese economic data and signs that Chinese authorities will reduce economic regulations.
The moves follow a 0.5 percent drop by the S&P 500 yesterday as worries that the Federal Reserve will slow stimulus measures caused traders to take profits. It had posted record closing highs in the previous four sessions.
Today's gains in Asia are another example of an emerging pattern of growth overseas lifting sentiment, something that hasn't happened since about 2007. Evidence increasingly suggests that Japan's economy is recovering from decades of stagnation and China is continuing to expand. (For example, Japan's core machinery orders surged 14.2 percent in March, more than quadruple forecasts.) An official at Spain's largest bank also told CNBC that the country's economy will start to improve in the second half.
The main event on today's calendar in the United States is the University of Michigan's consumer-sentiment index at 9:55 a.m. ET. Fed Chairman Ben Bernanke will also make a speech tomorrow, which could make some traders nervous he will hint at an end to quantitative easing.
Commodities are reflecting a sense of risk appetite today as oil, copper, and agricultural foodstuffs advance while precious metals remain under pressure. Foreign-exchange trading is mixed, with the euro, Australian dollar, and Canadian dollar all lower against the greenback.
In company-specific news, Aruba Networks is indicated lower after its earnings and outlook missed expectations. Nordstrom fell after its results missed expectations, shortly after similar retailers Dillard's and Kohl's reported weak sales. Brocade Communications is down after its numbers lagged Wall Street estimates, although Chinese Internet company Sina beat expectations on the top and bottom lines. (See our researchLAB screener for more on Chinese Internet companies, which have emerged as new source of strength in the last month.)