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U.S. stock futures rally after U.S., China data; Dow up 0.8%

Published 06/14/2011, 08:37 AM
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Investing.com – U.S. stock futures pointed to a broadly higher open on Tuesday, as a flurry of Chinese economic data eased concerns over global economic growth, while investors digested data on retail sales and producer price inflation.

Dow Jones Industrial Average futures pointed to a gain of 0.8%, the S&P 500 futures climbed 1.1%, while Nasdaq 100 futures indicated a rise of 0.9%.    

Earlier in the day, Chinese government data showed that consumer price inflation rose at an annualized rate of 5.5% in May, broadly in line with expectations.

Separate reports showed that producer price inflation increased slightly more-than-expected, while retail sales and industrial production data all showed robust growth, easing worries over a slowdown in the world’s second largest economy.

China's central bank later increased the reserve requirement ratio for its commercial lenders by 0.5% starting June 20.

Stock futures added to gains after official U.S. data showed that retail sales fell less-than-expected in May, while core retail rose broadly in line with expectations. Separately, producer price inflation in May rose slightly more-than-expected, while core PPI rose in line with expectations.

Meanwhile, shares in Finnish mobile phone company Nokia rallied 4.2% in pre-market trade after it agreed to settle a patent dispute with Apple, which will pay an undisclosed one-time fee and ongoing royalties. Apple shares added 0.7%.

The largest U.S. consumer electronics retailer Best Buy saw shares jump 6.8% after reporting first quarter profit that topped market expectations. Sales in the quarter rose 1.4% to USD10.9 billion, above expectations of USD10.7 billion.

Hewlett-Packard saw shares advance 0.5% after it announced a number of management changes, including two senior-management departures.

Meanwhile, shares in car-rental service Avis Budget Group could be active after it agreed to acquire its European counterpart Avis Europe in a deal valued at nearly USD1 billion. Avis Europe shares soared 57.8% in London. 
 
Other stocks in focus included pharmaceutical firms Teva and Cephalon. The U.S. Federal Trade Commission has requested additional information on Teva’s planned USD6.8 billion acquisition of Cephalon.  
 
Across the Atlantic, European stock markets rallied, boosted by the Chinese data that also fuelled gains in Asian markets. The EURO STOXX 50 jumped 1.3%, France’s CAC 40 rose 1%, Germany's DAX surged 1.65%, while Britain's FTSE 100 gained 0.5%.      

During the Asian trading session, Japan’s Nikkei 225 Index jumped 1.05%, while China’s Shanghai Composite Index gained 1.1%.

Later in the day, the U.S. was to produce data on business inventories, while Federal Reserve Chairman Ben Bernanke was to speak at a conference in Washington DC.

His comments would be closely watched for clues amid uncertainty over future U.S. monetary policy ahead of the end of the Fed’s quantitative easing program at the end of the month.

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