Stock futures mixed ahead of earnings
Stock futures down slightly for the Dow, S&P. But NASDAQ stock futures rise as Asia and Europe post gains.
NEW YORK and MILAN, ITALY — US stock futures are mixed after European leaders said they made progress on resolving the region's debt problems at a weekend summit but delayed offering any details.
Two hours ahead of the opening, Dow Jones industrial average futures are down 1 point to 11,756. S&P 500 index futures are down 1.60, or 0.1 percent, to 1,233.60. Nasdaq 100 futures are up 0.50 to 2,334.75.
European leaders say they will unveil plans to help resolve the crisis by Wednesday. Worries about Europe's debt problems have helped drag global stocks up and down over the last two years.
Strong corporate earnings reports last week helped drive the Dow Jones industrial average to its third straight weekly rise. The Standard & Poor's 500 index finished the week at its highest level since Aug. 3, before Standard & Poor's downgraded the U.S. credit rating on Aug. 5 and helped trigger big swings in global markets.
European leaders are likely to include measures to recapitalize the region's banks, which are expected to accept steep losses on Greek debt, as well as boosting the eurozone bailout fund.
"All eyes are very much on European leaders' attempts to find a workable solution to the ongoing debt crisis," said Stan Shamu of IG Markets. He noted "encouraging signs of progress emerging over the weekend" helped boost early trading in stock markets."
Italian Premier Silvio Berlusconi — who received stern words from the French and German leaders over the weekend — has convened his Cabinet to come up with a package of plausible growth measures by Wednesday, as demanded by EU leaders. Italy is seen as the next likely victim in the debt crisis, but the third largest eurozone economy would be too expensive to bail out.
Confidence-building measures will be sorely needed as European economic indicators continue to point downwards.
A key survey on Monday showed that activity in the eurozone's private sector fell more than expected in October. Momentum in both manufacturing and services continued to weaken, with the so-called purchasing managers' index falling to 47.3 and 47.2 respectively. A figure below 50 denotes contraction.
Economists said it showed that overall economic contraction was possible in the eurozone in the fourth quarter, but traders largely overlooked the report to focus on the likelihood that a European crisis plan would be ready by another leaders' summit on Wednesday.
Asian shares closed with solid gains earlier in the day as economic data from Japan and China showed a measure of strength.
Japan's Nikkei 225 index added 1.9 percent to close at 8,843.98 after the government said exports grew for a second straight month in September. The country's trade suffered a five-month decline in the wake of the March 11 earthquake and tsunami that devastated northeast Japan.
Mainland Chinese shares rose after HSBC said its preliminary China Manufacturing Purchasing Managers Index, which measures industrial production, rose to 51.1 in October from 49.9 in September. A result above 50 indicates expansion but the preliminary indicator is often subject to substantial revision.