Stock futures point to moderately higher open

[August 28, 2009]  NEW YORK (AP) -- Stock futures are moderately higher Friday ahead of an economic report that could provide more insight into how consumers are faring.

Investors might be taking a cue from overseas, where most markets rose. Strong earnings from consumer goods companies and a rise in European economic confidence helped push European markets higher.

Traders in the U.S. are awaiting a key Commerce Department report on personal spending and income. Consumer spending accounts for more than two-thirds of all economic activity, and improvement in buying is considered vital to an economic recovery.

Economists polled by Thomson Reuters expect personal spending rose 0.2 percent in July because of the popular Cash for Clunkers program. Spending rose 0.4 percent in June.

Personal income, which has been hammered during the recession as employers cut payrolls and forced workers to take unpaid days off to hold down wage costs, is also expected to have increased 0.2 percent in July. Income fell 1.3 percent in June.

The Commerce Department's report is due out at 8:30 a.m. EDT.

Investors also get a reading on consumer strength as the University of Michigan releases the final results of its August sentiment survey. When the preliminary August results released two weeks ago were worse than expected, it helped spur a big sell-off in the market.

The report is due out at 9:55 a.m. EDT.

Ahead of the opening bell, Dow Jones industrial average futures rose 34, or 0.4 percent, to 9,601. Standard & Poor's 500 index futures rose 5.20, or 0.5 percent, to 1,034.50, while Nasdaq 100 index futures rose 7.00, or 0.4 percent, to 1,646.00.

In corporate news, computer maker Dell Inc. reported better-than-expected results for its May through July quarter. While sales continued to fall because of reduced spending by consumers and businesses, Dell said it has seen signs of improvements.

Major indexes edged out gains on Thursday after starting the day lower. The Dow rose for the eighth consecutive day, increasing 37 points, its longest winning streak since April 2007. The market's five-month rally appears to have lost much of its steam as analysts say most of the improving economic data has already been priced into stocks. But, traders also aren't ready to completely reverse course and start selling off stocks believing the market is overbought.

Meanwhile, bond prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.49 percent from 3.46 percent late Thursday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.15 percent from 0.14 percent late Thursday.

The dollar mostly fell against other major currencies, while gold prices rose.

Overseas, Japan's Nikkei stock average rose 0.6 percent. In afternoon trading, Britain's FTSE 100 rose 1 percent, Germany's DAX index gained 1.3 percent, and France's CAC-40 climbed 1.4 percent.

[Associated Press; By STEPHEN BERNARD]

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