By Nick Baker and Nikolaj Gammeltoft June 7 (Bloomberg) -- U.S. stock futures advanced, erasing losses following the 2.3 percent weekly drop in the Standard & Poor’s 500 Index, after an unexpected gain in German factory orders improved confidence in the global economy. S&P 500 futures expiring this month climbed 0.2 percent to 1,067.80 at 7:47 a.m. in New York after retreating as much as 1.3 percent. The stock index plunged 3.4 percent on June 4 after private employers in the U.S. added 77 percent fewer jobs in May than the median economist estimate. Dow Jones Industrial Average contracts rose 2 points, or less than 0.1 percent, to 9,948. “This is a small glimmer of hope that Europe might be doing better,” Malcolm Polley, who oversees $1 billion as chief investment officer at Stewart Capital Advisors in Indiana, Pennsylvania, said of Germany factory orders. “A lot of the issues affecting markets have been coming from Europe, so this is an encouragement.” Equities in the U.S. have plunged since April 23, with investors battered by the widening debt crisis in Europe. The S&P 500 fell 13 percent through June 4, led by 17 percent slumps by gauges of energy and commodity producers. Confidence in stocks is sinking to record lows in the options market even with the U.S. economy poised for its fastest growth in six years, a sign to Blackstone Group LP’s Byron Wien that it’s time to buy. Bearish Options Contracts that pay off should the benchmark index for U.S. stocks plunge more than 23 percent from its April high cost 75 percent more than those speculating on gains, the biggest premium ever, according to data compiled by Bloomberg and OptionMetrics LLC. The 10-day average difference exceeded 50 percent 34 times since 1996. In those cases, the S&P 500 gained a median 7.2 percent in six months. The S&P 500 dropped on June 4 after a government spokesman said Hungary’s economy is in a “very grave situation.” Officials reversed course over the weekend, saying there was no danger of default after it spent two days telling the world the nation was at risk of a Greece-like crisis. “The market deteriorated a lot on Friday and the decline was logical after the unemployment data and comments by Hungary,” said Arnaud Scarpaci, a fund manager at Agilis Gestion in Paris, which oversees about $150 million. “Today Hungary reversed its statements. We could have a technical rebound.” To contact the reporters on this story: Nick Baker in New York at nbaker7@bloomberg.net; Nikolaj Gammeltoft in New York at ngammeltoft@bloomberg.net.

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