Osama bin Laden death may cause stocks to rise
Osama bin Laden death has caused 'exuberance and relief' among investors. The killing of bin Laden, along with strong earnings and a substantial deal in the drug sector, will likely send stocks up.
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President Barack Obama said late Sunday that bin Laden, the al-Qaida chief who inspired the Sept. 11, 2001 terror attacks, had been killed in a firefight with American forces in Pakistan. That raised investors' spirits on Wall Street.
But he cautioned that it had little economic impact and would likely result in only a short-term gain for the market. Most traders, he said, would still be focusing on earnings and economic news.
Dish Network Corp., Chrysler Group LLC and Humana Inc. all reported strong earnings Monday. Dish Network's first-quarter net income more than doubled, in part, because of a patent settlement with TiVo Inc. Its stock rose 8 percent in pre-market trading.
Humana's profit rose 22 percent. The company benefited as more people enrolled in its Medicare plans. Its stock was flat in pre-market trading.
Chrysler turned its first profit since leaving bankruptcy two years ago thanks to growing sales.
Ahead of the opening bell, Dow Jones industrial futures are up 70, or 0.6 percent, at 12,826.
Standard & Poor's 500 futures are up 7, or 0.5 percent, at 1,367. Nasdaq 100 index futures are up 12, or 0.5 percent, at 2,413.
Bond prices fell, sending yields higher. The yield on the 10-year Treasury note rose to 3.31 percent from 3.29 percent late Friday.
In corporate news, Israeli drugmaker Teva Pharmaceutical Industries Ltd. said it would buy Cephalon Inc. for $81.50 per share, or $6.8 billion. Cephalon's shares rose 6 percent in pre-market trading. The deal comes about a month after Cephalon rejected a $73-per-share takeover bid from Valeant Pharmaceuticals Inc.
Community Health Systems Inc. also raised its all-cash offer for rival hospital operator Tenet Healthcare Corp. by 21 percent to about $3.52 billion. Tenet's shares fell 6 percent ahead of the bell, while Community Health's stock was flat.
Later in the morning, the Institute of Supply Management's index of manufacturing activity is expected to show that manufacturing activity increased in April.
The Commerce Department will also likely report that builders started work on more projects in March after three straight monthly declines in construction spending.