U.S. stocks headed for a marginally positive open Monday amid better-than-expected earnings from home improvement retailer Lowe's as investors anticipated a typical summer session following the big power outage.
At around 7:00 a.m. ET, futures pointed to a modestly higher start for the major indexes. Strong European markets and some dollar gains added to the upward trend.
Wall Street was open for business Friday, thanks to generators and determined traders, but volume was slack after power was cut to areas across the eastern United States and Canada Thursday afternoon. Stocks managed small gains. For the week, the Dow was up 1.4 percent and the Nasdaq gained 3.5 percent.
"It was amazing how much resilience was shown by the U.S. markets after the power cut debacle on Thursday," David Buik, a trader at Cantor Index told Reuters. "These markets seem hell-bent on holding their line and investors and analysts alike seem confident that the U.S. economy is coming back on to the bit with a vengeance."
Recent economic reports have suggested that a recovery is indeed underway, and second-quarter earnings were solid, if not awe-inspiring. Yet, stocks have been in somewhat of a holding pattern of late, typical of summer and unsurprising after the 3-1/2 month rally between March and June.
There are no major economic reports due Monday. As such, the focus throughout the session Monday is likely to remain on the aftermath of the blackout and some corporate news.
Over the weekend, northern Ohio utility FirstEnergy said some of its power lines failed before the blackout, and that an alarm system to warn about the problem didn't work. FirstEnergy (FE: Research, Estimates) shares fell 40 cents Friday to $30.61.
Home improvement retailer Lowe's (LOW: Research, Estimates) reported a fiscal second-quarter profit of 75 cents per share early Monday, 6 cents better than the 69 cents analysts surveyed by First Call were expecting and up from 59 cents a share a year earlier.
The company's discussion of its growth prospects will be watched by analysts and investors, who will spend Tuesday comparing those prospects with those of industry leader Home Depot (HD: Research, Estimates) after its earnings report.
Shares of Lowe's rose 62 cents to $48.90 Friday.
Media companies are also likely to remain in focus as contenders finalize bids for the U.S. entertainment assets of Vivendi Universal. General Electric's (GE: up $0.23 to $28.78, Research, Estimates) NBC television unit, media company Viacom (VIA.B: down $0.02 to $42.95, Research, Estimates) and possibly Liberty Media are expected to line up for the final leg of the multi-billion dollar auction, with bids due on Monday.
Among other stocks to watch is AOL Time Warner (AOL: Research, Estimates). The media company's New Line Cinema unit came up a surprise winner at the weekend box office with its "Freddy vs. Jason" horror flick featuring the villains from the "Nightmare on Elm Street" and "Friday the 13th" series. AOL is the parent of CNN/Money.
In other news, Lehman Brothers raised its earnings forecast for the S&P 500 for the next two years. For 2003, the company now expects earnings of $53.25, up from $52, while for 2004, the firm expects earnings of $57.50, up from $56. The company's 12-month price target for the index was held steady at 1100.
Strength in insurers led European markets higher at midday. Asian stocks ended higher Monday, with Tokyo's Nikkei index closing above 10,000 for the first time in nearly a year. (Check the latest on world markets)
Among U.S. stocks trading in Europe, J.P. Morgan Chase (JPM: Research, Estimates) rose 3 percent. The banking company got a boost from a Barron's article this weekend saying the stock is undervalued relative to others in its sector.
Treasury prices were little changed in early trading, with the 10-year note yield at 4.52 percent. The dollar gained against the yen and euro.
Brent oil futures rallied 37 cents to $29.18 a barrel in London. Gold edged lower.
At around 7:00 a.m. ET, futures pointed to a modestly higher start for the major indexes. Strong European markets and some dollar gains added to the upward trend.
Wall Street was open for business Friday, thanks to generators and determined traders, but volume was slack after power was cut to areas across the eastern United States and Canada Thursday afternoon. Stocks managed small gains. For the week, the Dow was up 1.4 percent and the Nasdaq gained 3.5 percent.
"It was amazing how much resilience was shown by the U.S. markets after the power cut debacle on Thursday," David Buik, a trader at Cantor Index told Reuters. "These markets seem hell-bent on holding their line and investors and analysts alike seem confident that the U.S. economy is coming back on to the bit with a vengeance."
Recent economic reports have suggested that a recovery is indeed underway, and second-quarter earnings were solid, if not awe-inspiring. Yet, stocks have been in somewhat of a holding pattern of late, typical of summer and unsurprising after the 3-1/2 month rally between March and June.
There are no major economic reports due Monday. As such, the focus throughout the session Monday is likely to remain on the aftermath of the blackout and some corporate news.
Over the weekend, northern Ohio utility FirstEnergy said some of its power lines failed before the blackout, and that an alarm system to warn about the problem didn't work. FirstEnergy (FE: Research, Estimates) shares fell 40 cents Friday to $30.61.
Home improvement retailer Lowe's (LOW: Research, Estimates) reported a fiscal second-quarter profit of 75 cents per share early Monday, 6 cents better than the 69 cents analysts surveyed by First Call were expecting and up from 59 cents a share a year earlier.
The company's discussion of its growth prospects will be watched by analysts and investors, who will spend Tuesday comparing those prospects with those of industry leader Home Depot (HD: Research, Estimates) after its earnings report.
Shares of Lowe's rose 62 cents to $48.90 Friday.
Media companies are also likely to remain in focus as contenders finalize bids for the U.S. entertainment assets of Vivendi Universal. General Electric's (GE: up $0.23 to $28.78, Research, Estimates) NBC television unit, media company Viacom (VIA.B: down $0.02 to $42.95, Research, Estimates) and possibly Liberty Media are expected to line up for the final leg of the multi-billion dollar auction, with bids due on Monday.
Among other stocks to watch is AOL Time Warner (AOL: Research, Estimates). The media company's New Line Cinema unit came up a surprise winner at the weekend box office with its "Freddy vs. Jason" horror flick featuring the villains from the "Nightmare on Elm Street" and "Friday the 13th" series. AOL is the parent of CNN/Money.
In other news, Lehman Brothers raised its earnings forecast for the S&P 500 for the next two years. For 2003, the company now expects earnings of $53.25, up from $52, while for 2004, the firm expects earnings of $57.50, up from $56. The company's 12-month price target for the index was held steady at 1100.
Strength in insurers led European markets higher at midday. Asian stocks ended higher Monday, with Tokyo's Nikkei index closing above 10,000 for the first time in nearly a year. (Check the latest on world markets)
Among U.S. stocks trading in Europe, J.P. Morgan Chase (JPM: Research, Estimates) rose 3 percent. The banking company got a boost from a Barron's article this weekend saying the stock is undervalued relative to others in its sector.
Treasury prices were little changed in early trading, with the 10-year note yield at 4.52 percent. The dollar gained against the yen and euro.
Brent oil futures rallied 37 cents to $29.18 a barrel in London. Gold edged lower.
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