Futures Point to Higher Open on Wall Street
Wall Street was tilting toward a firmer open for Wednesday, with stock futures slightly higher ahead of earnings from Bank of America Corp. and with the Empire State index, Federal Reserve's Beige Book and more Fed speakers to come. Gains from overseas markets and a cheerier outlook from the World Bank were underpinning some positive sentiment.
Futures for the Dow Jones Industrial Average recently rose 31 points to 16330, and those for the S&P 500 index were up 2.7 points to 1835.60. The best performer so far was technology, with futures for the Nasdaq 100 index gaining 11.75 points, or 0.3%, to 3585.50 as Apple rose in thin trade on comments over its China Mobile deal.
Bank of America is due to report fourth-quarter earnings per share of 26 cents on revenue of $21.2 billion. Mortgages will be in focus after earnings from Wells Fargo & Co. and J.P. Morgan Chase & Co. on Tuesday showed plummeting home-lending.
On the data front, the Empire State index for January and December producer prices are both scheduled for release at 8:30 a.m. EST. The Beige Book will be published at 2 p.m. EST, and investors will be looking to see if it gives off a positive vibe over the economy.
Chicago Fed President Charles Evans is due to speak at 12:50 p.m. EST, while Atlanta Fed President Dennis Lockhart, who also gave a talk on Monday, will speak at 5:45 p.m. EST, after the market closes. A day prior, Dallas Fed President Richard Fisher said he wanted the taper to be double the size it was, while Philadelphia Fed President Charles Plosser said he wants the Fed to exit quantitative easing before the end of 2014.
But markets brushed aside the Fed speak on Tuesday in favor of better-than-expected retail sales and tech gains, pushing Wall Street to its best day of the year. The S&P 500 index closed up 19.68 points, or 1.1%, to 1,838.88, while the Dow industrials rose 115.92 points, or 0.7%, to 16373.86, breaking a four-session losing streak.
"Technically it's still a buyer's market, but the increased volatility in recent sessions is a sure signal something's about to give," said Mike McCudden, head of derivatives at stockbroker Interactive Investor, in a note. "News that the World Bank has upgraded its global outlook while U.S. consumer spending surprised to the upside may have brought some calm to the VIX (Volatility Index) but the poor jobs data last week should serve as a reminder that the U.S. economic recovery is still patchy."
The World Bank said high-income economies will drive faster economic growth world-wide this year, as they appear to be "finally turning the corner" after the financial crisis. The body sees global growth rising to a rate of 3.2% in 2014 from 2.4% last year, and rising to 3.4% in 2015.
Other regions picked up the baton from Wall Street, with Japan's Nikkei 225 index closing up 2.5% and Europe notching five-year highs, lifted by the World Bank comments. Oil prices inched up, while gold slipped. The dollar index traded choppy, but was last lower.
Apple rose more than 1% in thin trade after the chairman of China Mobile Ltd. said the company's deal with Apple will entail broad cooperation between the two. He also said millions of iPhones have already been ordered by customers, signalling strong demand for the device. Apple's Chief Executive Officer Tim Cook said he was "incredibly optimistic" about the outcome of cooperating with the Chinese carrier.