BLBG: U.S. Stock Futures Swing Between Gains, Losses; FedEx Slumps
By Daniela Silberstein and Whitney Kisling
Dec. 9 (Bloomberg) -- U.S. stock-index futures drifted between gains and losses as speculation that government stimulus programs will boost the economy offset forecasts from FedEx Corp. and Texas Instruments Inc. that disappointed investors.
FedEx, the second-biggest U.S. package-shipping company, lost 8.5 percent after saying the weakening economy is hurting profits. Texas Instruments, the second-largest U.S. chipmaker, and National Semiconductor slid more than 1 percent. Standard & Poor’s 500 Index futures rebounded after earlier losing as much as 1 percent, climbing with European shares as German investor confidence unexpectedly improved.
The S&P 500 yesterday extended its gain from an 11-year low last month to 21 percent, marking a technical end to the 13-month bear market, as President-elect Barack Obama pledged the biggest public-works spending package since the 1950s. The benchmark for U.S. equities is still down 38 percent in 2008 after the collapse of subprime mortgages curbed earnings.
“A lot of bad news is already priced in,” said Andreas Nigg, who helps oversee $39 billion as a fund manager at Vontobel Asset Management in Zurich. “We are in a phase where markets are trying to find a bottom.”
Futures on the S&P 500 expiring in December lost 0.1 percent to 903.5 at 8:25 a.m. in New York. Dow Jones Industrial Average futures declined 0.3 percent to 8,850 and Nasdaq-100 Index futures slipped 0.4 percent to 1,207.75.
European shares rose for a second day and Asian stocks climbed for a third, led by commodity producers and shipping lines, on expectations stimulus plans from the U.S. to India will buoy the global economy.
$1 Trillion
More than $31 trillion has been erased from the value of global equities this year, while debt losses and writedowns at the world’s largest lenders and insurers approach $1 trillion.
Stocks will climb in 2009 in the face of falling earnings and a slowdown in economic growth because of cheap valuations, according to strategists at Credit Suisse Group AG, Deutsche Bank AG and Merrill Lynch & Co. The S&P 500 may rise to 1,050 by the end of 2009 from yesterday’s closing price of 909.7, a team of Credit Suisse strategists wrote in a note today.
To contact the reporters on this story: Daniela Silberstein in Zurich at dsilberstei2@bloomberg.net; Whitney Kisling in New York at wkisling@bloomberg.net.
