MW: U.S. stock futures climb after Citigroup rescue
By Steve Goldstein & Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stock futures pointed to opening gains on Monday after the last session's blast higher, with Citigroup Inc. set to rise on the government's rescue of the onetime largest bank in the nation.
"The financials are leading the bound on the government's backstop for Citi," said Marc Pado, U.S. market strategist at Cantor Fizgerald.
The $326 billion plan to save Citi follows intense weekend negotiations that has the government backing as much as $306 billion of the bank's troubled assets and leaves it in charge of executive bonuses. Read more.
Shares of Citi shot 53.1% higher in pre-market trade.
S&P 500 futures rose 21.6 points to 813.6 and Nasdaq 100 futures rose 23.75 points to 1,114.75
Dow industrial futures added 128 points to 8,164.
A late-hour rally pushed U.S. stocks to huge gains on Friday, with the Dow Jones Industrial Average jumping 494 points, the Nasdaq Composite rising 68 points and the S&P 500 rising 47 points. The surge higher came after news leaked that President-elect Barack Obama would nominate New York Federal Reserve President Timothy Geithner for Treasury Secretary.
"The importance of this announcement is two-fold. First, with Paulson publicly stating that he is not interested in pursuing the second $350 billion, it is putting the pressure on the Obama administration to get the process moving as quickly as possible to get these funds. Second, Geithner was a key government official in the financial rescue plan, which means he has intimate knowledge of what needs to be done," said Pado.
On the economic front, existing home sales for October will be released, while the U.K. is expected to announce a cut in value-added taxes. Obama's economic team is due to be officially announced.
Target Corp. late Friday announced it rejected a proposal by activist investor Bill Ackman to spin off real estate holdings.
Campbell Soup Co. - which traditionally benefits in times of a recession - gained nearly 1% ahead of the opening bell after the company reported first-quarter profit of $260 million.
After the close, Hewlett-Packard Co. and Analog Devices Inc. are scheduled to report.
Oil futures gained $1.23 to $51.16 a barrel and the dollar dropped 0.1% to 95.81 yen.
Overseas, the FTSE 100 surged 4.5% in London. Asia stocks weren't as strong, with the Hang Seng dropped 1.35%. Tokyo was closed.
