Stock futures point to higher open to end quarter

[June 30, 2010]  NEW YORK (AP) -- Stocks are set to rise Wednesday, providing some relief at the end of an otherwise dreary quarter that saw major indexes plunge on fears that a global economic recovery would come to a halt. Futures are higher.

The Dow Jones industrial average is down 9.1 percent for the quarter. Disappointing economic reports, including continued high levels of unemployment, and fears of a possible second recession in Europe have spooked investors. That led to a steady sell-off over the past three months.

Wednesday's gains in futures come before a payroll company is expected to report hiring by private companies climbed slightly in June. ADP is expected to say 60,000 jobs were added during the month, compared with 55,000 in May, according to economists polled by Thomson Reuters. The report is due out at 8:15 a.m. EDT.

The ADP report is often seen as a precursor to the Labor Department's big monthly jobs report due out Friday. ADP's data only includes jobs created by private companies so it can vary widely from the Labor Department data, which also includes government jobs.

In fact, Friday's report is expected to show employers cut a total of 110,000 jobs in June. However, the net loss of jobs is tied primarily to the government laying off temporary workers that were hired to work on the 2010 census.

Traders will be focused more on the ADP report and the government's specific details about private sector hiring for signs that companies are more confident in the economy and starting to rehire workers.

Companies have been slow to add new jobs coming out of the recession, which has hurt the pace of a recovery. Consumer confidence has fallen and spending has not picked up as investors had hoped because there are so many people still out of work. Consumer spending is the primary driver of economic activity in the country.

Still any signs of job growth will likely be welcomed by investors, looking for some signs of improvement.

Ahead of the opening bell, Dow Jones industrial average futures rose 46, or 0.5 percent, to 9,843. Standard & Poor's 500 index futures rose 6.10, or 0.6 percent, to 1,041.40, while Nasdaq 100 index futures rose 9.50, or 0.5 percent, to 1,773.00.

Stocks plummeted Tuesday in a fashion that was typical for the second quarter. The Dow tumbled 2.7 percent, falling right from the start of the day as investors fretted about reports of economic slowdowns in China and Japan as well as new strikes in Greece. An unexpectedly sharp drop in the Conference Board's consumer confidence reading also worried traders.

Greek residents have routinely been protesting austerity measures put in place to stem mounting debt problems. The budget cuts are necessary for Greece to receive bailout funds from other European Union members.

Mounting debt across Europe has rocked global stock markets all quarter. Investors are worried that budget cuts needed to control debt will slow Europe's economy to the point that it also eats into growth worldwide.

The euro, used by 16 European Union members, rose Wednesday after the European Central Bank said it will lend European banks $161 billion to help refinance loans coming due. The euro, which has become a proxy for confidence in Europe's economy, rose to $1.2287. But, it has dropped about 9 percent this quarter.

As investors pulled out of stocks and fled the euro throughout the quarter, U.S. Treasurys and gold were big beneficiaries. The perceived safety of the two helped push bond and gold prices higher.

The yield on the 10-year Treasury note, which moves opposite its price, fell below 3 percent for the first time in more than a year on Tuesday, falling to 2.95 percent. It rebounded off that low Wednesday morning, rising to 2.97 percent.

Gold rose again Wednesday, climbing $1.90 to $1,244.30 an ounce. It has risen nearly 12 percent this quarter.

Overseas, Britain's FTSE 100 rose 0.7 percent, Germany's DAX index gained 0.4 percent, and France's CAC-40 rose 0.6 percent. Japan's Nikkei stock average fell 2 percent.

[Associated Press; By STEPHEN BERNARD]

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