NEW YORK (Reuters) - Stock index futures rose on Monday, pointing to a firmer start to the week on Wall Street, as signs of further easing of interbank lending rates sparked hopes that confidence was returning to the credit markets.
Stock markets in Asia and Europe were buoyed by optimism that global efforts to shore up the banking system were taking hold as the cost for banks to borrow from each other fell.
Energy shares, among sectors that have been severely beaten down due to recession fears, were poised to spark some interest after analysts at Oppenheimer & Co raised recommendations on a raft of energy bellwethers, including Exxon Mobil (XOM.N: Quote, Profile, Research, Stock Buzz), Chevron (CVX.N: Quote, Profile, Research, Stock Buzz) and ConocoPhillips (COP.N: Quote, Profile, Research, Stock Buzz) .
"I think the real factor here is we have short-term lending rates that are really beginning to narrow substantially, and that's an indication that things might be getting back to normal very shortly," said Peter Cardillo, chief market economist at Avalon Partners in New York.
"The bottom line is there seems to be more optimism, a little bit of confidence coming back into the market place."
S&P 500 futures rose 17.10 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures climbed 147 points, and Nasdaq 100 futures added 22 points.
In deal activity, Exelon Corp (EXC.N: Quote, Profile, Research, Stock Buzz), the largest U.S. nuclear power operator, made an unsolicited offer over the weekend to acquire NRG Energy Inc (NRG.N: Quote, Profile, Research, Stock Buzz) for $6.2 billion in stock. NRG shares jumped 24 percent to $24 before the bell while Exelon slipped 2.7 percent to $53.04.
The economic diary is thin, with only a report on leading economic indicators for September due at 10 a.m. EDT. Federal Reserve Chairman Ben Bernanke is expected to testify at a House Budget Committee hearing on the economic outlook and financial markets at 10 a.m.
Lending rates among banks have been at the heart of the credit crunch. More rescue packages for banks in Europe also boosted optimism over government measures to thaw frozen credit markets.
Oil field services company Halliburton Co (HAL.N: Quote, Profile, Research, Stock Buzz) reported a net loss before the bell on Monday, hurt in part by an acquisition-related charge.
Among companies still expected to post quarterly results are American Express (AXP.N: Quote, Profile, Research, Stock Buzz), Lockheed Martin (LMT.N: Quote, Profile, Research, Stock Buzz), and Texas Instruments (TXN.N: Quote, Profile, Research, Stock Buzz).
According to theflyonthewall.com, Oppenheimer & Co raised its recommendations on a slew of energy stocks. Exxon shares were up 1.5 percent at $69.04 before the bell. OPEC meets this week and thee are expectations the cartel may cut output.
U.S. stocks ended lower on Friday after bleak data on consumer confidence and construction, but the Dow was still able to snap a deep three-week losing streak with it best weekly gain in more than 5 years.
Friday's choppy action capped an extremely volatile week, with stocks swinging back and forth between positive and negative territory as investors weighed the health of the economy and prospects of a recession.
