Stock Futures Climb as European Inflation Cools

By MarketsFOXBusiness

FOX Business: Capitalism Lives Here

U.S. stock-index futures climbed on Monday after a weak inflation reading from Europe heightened hopes the ECB will cut rates this week.

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As of 7:45 a.m. ET, Dow Jones Industrial Average futures climbed 57 points, or 0.35%, to 16297, S&P 500 futures advanced 6.8 points, or 0.36%, to 1857 and Nasdaq 100 futures rose 16 points, or 0.45%, to 3580.

The broad S&P 500 is looking to extend its winning streak to five quarters, posting a small gain for the first quarter of 2014. The five-quarter run would be the longest since 2007, and the sharpest since 2004. Still, it's been a shaky quarter, as evidenced by the Dow likely closing down by more than 1%.

Inflation in the eurozone fell to an annual pace of 0.5% in March from 0.7% the prior month. It was the lowest reading since 2009. Policymakers across the developed world have been worried about very low levels of inflation potentially hindering growth. In Europe, there are even fears that prices could begin falling -- a situation that can be tough for monetary policy to fix.

"Our economists view this as an uncomfortably low number for the ECB, but note that some of the decline may be explained by volatile items such as food (on the mild winter) and base effects owing to the late timing of Easter," economists at Nomura wrote in a note to clients.

"As inflation is expected to bounce back in April, our economists expect the ECB to refrain from cutting rates this week and wait until the April inflation numbers."

In commodities, U.S. crude oil futures fell 38 cents, or 0.35%, to $101.31 a barrel. Wholesale New York Harbor gasoline dipped 0.82% to $2.914 a gallon. Gold climbed $1.60, or 0.12%, to $1,296 a troy ounce.

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