Stock futures rise, helped by Cisco results
Stock index futures rose on Wednesday, indicating that equities would rebound after a series of weak sessions on strong results from Cisco.
The S&P 500 has fallen 3.8 percent over the past five session, with most of those losses driven by uncertainty over looming U.S. "fiscal cliff" demand and persisting concerns over Europe. The index closed below its 200-day moving average for a fourth day in a row on Tuesday, a technical indicator that suggests recent declines could gain momentum.
Cisco Systems Inc reported first-quarter earnings and revenue late Tuesday that beat expectations, sending the stock soaring 8.3 percent to $18.25 in premarket trading Wednesday. The Dow component also forecast flat earnings and slower revenue growth for the current quarter.
The results could boost sentiment over the technology sector , where shares have dropped almost 10 percent in value over the past two months, dragged down by earnings disappointments from key names like Google . Tech was the worst-performing sector on Tuesday.
Still, macroeconomic issues will likely still play a major role in trading direction as investors continue to grapple with Europe's debt crisis and the fiscal cliff, a series of mandated tax hikes and spending cuts that start to take effect next year.
Analysts say serious fiscal negotiations are still weeks away, but that the failure to reach a deal in Congress could tip the world's largest economy into recession.
S&P 500 futures rose 6.7 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 added 48 points and Nasdaq 100 futures rose 17.5 points.
European shares <.FTEU3> were 0.5 percent lower as Greece's unresolved debt crisis continued to raise questions about the region's growth potential, while anti-austerity strikes across southern Europe added to concerns that measures to deal with the debt would be politically difficult to implement.
International Monetary Fund Managing Director Christine Lagarde said on Wednesday she expected a real fix for Greece that included debt sustainability, rather than a quick fix.
Tyco reported adjusted fourth-quarter earnings that missed expectations. NetApp Inc , Staples Inc and Abercrombie & Fitch are on tap to report later Wednesday.
October retail sales are on tap for release at 8:30 a.m. ET (1330 GMT) and are seen dropping 0.2 percent. In September, sales climbed 1.1 percent. Also, the latest FOMC minutes will be released Wednesday afternoon.
U.S. stocks fell in a volatile session Tuesday, pressured by Microsoft Corp which fell after the surprise departure of a key executive. However, retail names outperformed after Home Depot raised its outlook.
(Editing by Bernadette Baum)