US stocks may rise after Mideast truce, oil slide

NEW YORK - US stock futures pointed to a higher opening on Monday on Wall Street as a drop in crude prices to a two-week low and a U.N.-brokered truce in Middle East, eased investor risk fears.

By (Reuters)

  • Follow us on
  • google-news
  • whatsapp
  • telegram

Published: Mon 14 Aug 2006, 7:58 PM

Last updated: Sat 4 Apr 2015, 2:12 PM

Lower oil prices may help lift shares in industrial conglomerates such as 3M Company and chemical companies including Dow Chemical & Co. and DuPont Co.

Automotive shares may also be in focus after Bear Stearns raised Ford Motor Co. to “outperform” from “underperform”, while it cut General Motors Corp. to “underperform,” from “peer perform”, MarketWatch reported on its Web site.

Ford shares rose 3.8 percent to $7.65 on the Inet electronic brokerage system in pre-market trading. GM shares were unchanged.

On the earnings front, Computer Associates Inc. and Agilent Technologies Inc. are among the few S&P500 companies slated to report results on Monday. On Tuesday, reports by Dow components Wal-Mart Stores Inc. and Home Depot Inc. will follow.

Oil prices were down more than a $1 to $73.04 a barrel as a truce to end five weeks of fighting between Israel and Hezbollah took effect, and after BP said it would keep half its Prudhoe Bay field -- North America’s biggest oilfield -- pumping while it carries out pipeline repairs.

“The cease-fire in the Middle East and lower crude prices may give that extra boost to stocks this morning,” said Anthony Chan, chief economist at JPMorgan Client Services in New York. “Even if short-lived, it’s very positive for stocks. The biggest fears that were weighing on stocks on Friday, seem to be subsiding.”

Standard & Poor’s 500 futures were up 6.5 points, above fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.

Dow Jones industrial average futures shot 60 points higher, and Nasdaq 100 futures were up 10 points.

Investors will also keep focused on inflation data this week. The Labor Department’s report on the US producer price index, set for Tuesday, followed Wednesday by data on consumer prices may give some indication about the Federal Reserve’s next move.

The Fed last Tuesday left rates unchanged after raising rates 17 times since June 2004.

Shares in Whole Foods Market Inc. may rise after analysts at JP Morgan upgraded the company’s stock to “neutral” from ”underweight”.

Other movers on Monday may include HealthSouth Corp.. The Wall Street Journal reported that the company, which is recovering from an accounting scandal, will try to sell or spin off its outpatient-rehabilitation and surgery units in a bid to shrink debt.

Also on the corporate front, PepsiCo Inc. on Monday named Indra Nooyi as its new chief executive, effective Oct. 1, succeeding Steve Reinemund, who plans to retire next May.

More news from