Futures gain on Fed hopes

US markets are set for a higher open ahead of the Federal Reserve policy meeting.

By Benzinga Jun 17, 2013 8:25AM

zurbar age fotostockBy Matthew Kanterman


U.S. equity futures advanced in early premarket trade ahead of the much anticipated Federal Reserve two-day policy meeting Tuesday. Despite recent fears of tapering, the Fed is expected to downgrade its economic forecasts near consensus economist forecasts, which could increase dovish rhetoric in the policy statement.


In other news, the Spanish government blocked AT&T's (T) bid for Telefonica (TEF), Europe's most indebted telecommunications company, citing its strategic position to the Spanish economy.


Bloomberg reported that Boeing (BA) is expected to announce a new order of 10 787 Dreamliners from General Electric's (GE) aircraft leasing unit.


Time Warner's (TWX) Man of Steel, the relaunch of the Superman movie series, became the second-most successful movie of the year after making $113 million in its first weekend, behind only Iron Man 3.

  • S&P 500 futures rose 10.8 points to 1,629.90.

  • The EUR/USD was lower at 1.3337.

  • Spanish 10-year government bond yields were flat at 4.58%.

  • Italian 10-year government bond yields fell to 4.28% from 4.29%.

  • Gold declined 0.07% to $1,386.60 per ounce.

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Asian markets

Asian shares were mixed overnight as the Nikkei recovered some recent losses. The Japanese Nikkei 225 Index gained 2.73% and the Topix Index rose 2.68%. In China, the Shanghai Composite Index fell 0.25% while the Hang Seng Index rose 1.08% in Hong Kong. Also, the Korean Kospi declined 0.32% and Australian shares rose 0.71%.


European markets

European shares were mostly higher in early trade as well save for Italian stocks. The Spanish Ibex Index gained 0.54% while the Italian FTSE MIB Index declined 0.78%. Meanwhile, the German DAX rose 0.8% and the French CAC 40 gained 0.62% while U.K. shares rose 0.55%.


Commodities

Commodities were mixed overnight as markets awaited the Fed's decision later this week. WTI crude futures were flat at $97.85 per barrel and Brent crude futures were flat as well at $105.93 per barrel. Copper futures rose 0.64% to $322.20 per pound. Gold was lower and silver futures declined 0.34% to $21.88 per ounce.


Currencies

There was some tentative dollar strength overnight as the euro and the yen both fell against the dollar. The EUR/USD was lower at 1.3337 and the dollar gained against the yen to 94.94. Overall, the Dollar Index rose 0.14% on strength against the yen, the Swiss franc, and the euro.


Earnings reported Friday

Key companies that reported earnings Friday include:

  • American Semiconductor (AMSC) reported a fourth quarter loss of $0.21 per share, in line, on revenues of $20.4 million vs. $18.8 million expected. However, first quarter guidance was well below expectations.

  • Smithfield Foods (SFD) reported fourth quarter earnings per share of $0.21 vs. $0.43 on revenue of $3.22 billion vs. $3.27 billion expected.

Earnings

Notable companies expected to report earnings Monday include:

  • China Sunergy (CSUN) is expected to report a first quarter loss of $1.01 per share vs. a loss of $0.71 per share a year ago.

  • IHS Inc. (IHS) is expected to report second quarter EPS of $1.03 vs. $0.97 a year ago.

  • Korn/Ferry International (KFY) is expected to report fourth quarter EPS of $0.31 vs. $0.28 a year ago.

Economics

On the economics calendar Monday, the OECD composite leading indicators are due out, followed by the Empire State manufacturing index and the NAHB home price index. In addition, the Fed's Bullard is expected to speak at 9:50 a.m. ET and the Treasury is set to hold its weekly auction of 3- and 6-month bills. Overnight, the Bank of Japan press conference and the British industrial production report are due out.


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