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U.S. futures jump on easing speculation; Dow Jones up 0.91%

Published 06/06/2012, 06:56 AM
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Investing.com - U.S. stock futures pointed to a sharply higher open on Wednesday, amid growing expectations for further stimulus measures by central banks in order to counter the effects of a slowdown in global economic growth. 

Ahead of the open, the Dow Jones Industrial Average futures pointed to a gain of 0.91%, S&P 500 futures signaled a 1.09% rally, while the Nasdaq 100 futures indicated a 1.07% jump.

Market sentiment found support amid speculation by market players that the ECB could announce liquidity injections in to Europe's troubled financial system.

Other analysts expect the central bank to renew its suspended government bond-buying program to help ease pressure on Spain’s rising borrowing costs.

In addition, Federal Reserve Chairman Ben Bernanke was due to testify on Thursday before a congressional committee about the strength of the U.S. economy.

The Wall Street Journal, citing interviews and Fed speeches, reported late Tuesday that the U.S. central bank is mulling new measures to stimulate growth in the world’s largest economy.

Financial stocks were expected to be active as lenders surged in European morning trade, despite a decision by Moody’s ratings agency to downgrade six German banks and Austria’s three largest lenders, saying they face risks if the euro zone crisis deepens.

Shares in Bank of America and Citigroup jumped 2.25% and 1.17% in pre-market trade.

Energy companies were also likely to move on Wednesday, as Exxon Mobil gained 0.32% and Chevron rose 0.26%, while ConocoPhillips added 0.15% in late trading on the back of rising crude oil prices.

Chesapeake Energy also rallied 2.91% amid reports the oil and gas giant is in advanced talks to sell pipelines to Global Infrastructure Partners for more than USD4 billion.

Meanwhile, shares in General Motors were up 0.24% in after hour trade, as the company’s struggling European unit Opel emerged from its worst-ever sales crisis in Germany and now expects to gradually expand its slice of the market back into the double digits, a level not seen since 2005, according to a Reuters report.

Facebook was also slated to remain in focus, as the social media giant was said to be facilitating advertisers’ access to the growing ranks of users on smartphones and mobile devices, taking a significant step toward addressing one of investors' most pressing concerns and broadening its appeal to marketers.

Facebook shares surged 1.51% in early trading.

Across the Atlantic, European stock markets were sharply higher. The EURO STOXX 50 soared 2.09%, France’s CAC 40 surged 2.03%, Germany's DAX jumped 1.73, while Britain's FTSE 100 rallied 1.68%.

During the Asian trading session, Hong Kong's Hang Seng Index advanced 1.43%, while Japan’s Nikkei 225 Index climbed 1.81%.

Also Wednesday, official data showed that German industrial production dropped 2.2% in April, compared to expectations for a more modest 1.0% decline, fuelling concerns over the impact of the ongoing sovereign debt crisis on the region’s largest economy.

Later in the day, the U.S. was to release revised data on nonfarm productivity, followed by government data on crude oil stockpiles, while the Federal Reserve was to release its Beige Book.


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