MW: U.S. stock futures climb as China unveils stimulus
By Steve Goldstein, MarketWatch
Last update: 6:49 a.m. EST Nov. 10, 2008Comments: 72
LONDON (MarketWatch) -- U.S. stock futures rose on Monday, with commodities and their extractors getting a particular lift after China unveiled a stimulus package worth more than $500 billion.
S&P 500 futures rose 22.7 points to 958.90 and Nasdaq 100 futures climbed 31.75 points to 1,320.20. Dow industrial futures climbed 194 points.
U.S. stocks ended with strong gains on Friday as investors looked past a report showing 240,000 jobs lost in October and big quarterly losses at General Motors and Ford Motor Co. But over the course of the week, the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite each lost about 4%.
China over the weekend announced a 4 trillion yuan, or about $586 million, plan to loosen credit conditions, cut taxes and embark on major infrastructure spending.
China's plan gave a major lift to commodities that had been dragged down on fears over slowing economic growth.
"It should compensate for some of the weakness in the economy that is generated by the poor outlook for exports - but we do not see it compensating all the weakness," said economists at UBS.
Oil futures rose $3.65 to $64.69 a barrel, and gold futures climbed $20.10 to $754.30 an ounce.
The dollar rose vs. the Japanese yen but fell against the euro.
Overseas, the Hang Seng rose 4.2% in Hong Kong and the FTSE 100 added 3% in London, buoyed by commodity-related firms like Rio Tinto .
American International Grouprose 11% in Frankfurt as the insurer reached a deal with the U.S. government to scrap the original $123 billion bailout. The new terms allow AIG to pay less interest as the insurer reported a loss for the third quarter of over $24 billion.
Europe's largest bank, HSBC Holdings , said its profit before tax rose in the third quarter after it reported a $3.4 billion gain on the changing value of its own debt and re-classified $13 billion of assets under new accounting rules.
Banco Santander , another European banking giant, said it was rising $9.25 billion in fresh capital by selling shares.
Outside of financials, NRG Energy rejected Exelon's takeover bid.
McDonald's is scheduled to report October same-store sales, and after the close, Starbucks is due to report quarterly results.
Nortel Networks reported a $3.4 billion loss as revenue dropped.
