Tuesday, October 5, 2010

US Stock Futures Up But Off Highs Ahead Of ISM

From Dow Jones Newswires - Top Stories
---By Barbara Kollmeyer; 34 91 395 8131; AskNewswires@dowjones.com

DJIA futures is trading at 10,754 now (8.30pm GMT+8)
U.S. stock-index futures signaled opening gains for Wall Street on Tuesday, with key ISM non-manufacturing data on tap and gold pushing higher in the wake of a Bank of Japan policy move.

Futures pared back their earlier advance, though, with the Dow Jones Industrial Average lately moving up 16 points to 10722 while those for the Nasdaq 100 advanced 6.26 points to 1983.25. Futures for the S&P 500 gained 2.4 points to 1137.20.

Stocks lost ground on Monday as downgrades hit several sectors, raising jitters about earnings season, which blue chip Alcoa Inc. (AA) is due to kick off later this week.

First and foremost for the U.S. markets on Tuesday is the ISM non-manufacturing data for September, scheduled for release at 10 a.m. Eastern time. Economists surveyed by MarketWatch are forecasting the index to rise to 52.3 from 51.5 in the prior month.

"After the disappointing ISM [manufacturing] number last week, people will watch very carefully what is happening with this index, the main factor to drive the market on the economic front," said Francois Savary, economist and director of investments at the Reyl Group.

This Friday 8-Oct-10: Nonfarm payroll data for September
Friday's nonfarm payrolls data for September remain the main event for the week, he said. "The influence of that number and the certainty concerning that number will be key from the point that people will be able to reassess prospects of rapid or not rapid quantitative easing and the Federal Reserve," he said.

Savary said the market remains range-bound and the S&P 500 could go to 1120, with much depending on Friday's data. But until earnings season gets into full steam, macroeconomic issues will continue to be key, he said.

Central banks delivered some surprises in overnight markets with the Bank of Australia holding steady on interest rates and the Bank of Japan dropping its policy interest-rate range to between zero and 0.1%, saying it plans to buy a variety of assets. Stocks in Japan largely shrugged off the news, while the Australian dollar fell but stocks there pared earlier losses.

Gold touched an intraday record of $1,329.60 an ounce. The dollar sank against the yen after getting only a brief Bank of Japan-related boost.

The dollar and gold tend to move in different directions. The dollar index dropped 0.3% to 78.315.

Stoxx Europe 600 Index
In Europe, stocks were poised to halt a six-session losing streak, with the Stoxx Europe 600 index gaining 0.1%. The market shook off news that Moody's Investors Service has put Ireland's credit rating under review for a possible downgrade.

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