Stock futures point to 4th straight day of gains

[December 23, 2009]  NEW YORK (AP) -- Stocks are set to rise for the fourth straight day as investors gain confidence in a building economic recovery.

Traders get key reports Wednesday on consumer spending and income as well as new home sales that are expected to show further improvement.

Overseas markets are rising as well, also encouraged by prospects for economic growth. Major indexes in France and Germany both hit 2009 highs, a day after the Standard & Poor's 500 index and the Nasdaq composite index closed at their highs for the year.

Economists expect consumer spending and incomes both rose in November. A rebound in the strength of consumers is considered vital to a recovery because their consumption accounts for about 70 percent of all economic activity.

Spending likely rose 0.6 percent in November, just below the 0.7 percent jump seen in October, according to economists polled by Thomson Reuters. Economists expect income rose 0.5 percent last month, which would be the biggest growth since May, when tax breaks boosted workers' paychecks.

The Commerce Department releases the data at 8:30 a.m. EST.

Ahead of the opening bell, Dow Jones industrial average futures rose 28, or 0.3 percent, to 10,436. Standard & Poor's 500 index futures rose 4.40, or 0.4 percent to 1,118.00, while Nasdaq 100 index futures rose 7.25, or 0.4 percent, to 1,848.25.

A report from the Commerce Department is expected to show sales of new homes continued to grow in November for the third straight month.

Economists expect new home sales jumped 2.3 percent to a seasonally adjusted annual rate of 440,000 from 430,000 in October.

The new home sales' report is scheduled to be released at 10 a.m. EST.

Stocks rallied Tuesday after the National Association of Realtors said sales of existing homes grew more than expected last month. Sales of existing homes rose 7.4 percent in November, much stronger than the 2.5 percent increase that was expected.

In corporate news, Ford Motor Co. said it is close to selling its Volvo unit to China's Geely. Ford has been trying to unload the division since last year to focus on its core brands, Ford, Lincoln and Mercury. The deal is likely to be finalized in the first quarter and close in the second quarter of 2010.

Meanwhile, bond prices were little changed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.75 percent from 3.76 percent late Tuesday. The yield on the three-month T-bill, considered one of the safest investments, rose to 0.08 percent from 0.06 percent.

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

Overseas, Britain's FTSE 100 gained 0.8 percent, Germany's DAX index rose 0.3 percent, and France's CAC-40 rose 0.7 percent. Trading in Japan was closed for a holiday.

[Associated Press; By STEPHEN BERNARD]

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