Stock futures rise modestly, point to higher open

[May 12, 2010]  NEW YORK (AP) -- Market turbulence continued to ease Wednesday after more than a week of wild swings tied to fears about growing European debt problems. Stock futures rose modestly.

Investors' attention is returning to the health of the U.S. economy after focusing for more than a week on whether Greek debt problems would spread across Europe, upending a global economic recovery and possibly destroying the euro.

Overseas markets were mixed as volatility diminishes globally. Stocks rallied sharply Monday after European leaders agreed to a nearly $1 trillion bailout to help contain the debt problems that spooked markets last week.

While stocks have stabilized, currency markets are still in flux. The euro edged higher against the dollar Wednesday. But it is still hovering near a 14-month low.

Uncertainty over the long-term health of the euro has helped boost gold to a new record. Investors worry the euro, which is used by 16 countries, could still lose value as debt-burdened countries cut spending to reduce high debt. Investors have turned to gold as an alternative to currencies.

Gold jumped $24.50 to $1,244.80 an ounce. Earlier in the day it climbed as high as $1,245.80 an ounce.

Ahead of the opening bell, Dow Jones industrial average futures rose 23, or 0.2 percent, to 10,732. Standard & Poor's 500 index futures rose 3.70, or 0.3 percent, to 1,155.90, while Nasdaq 100 index futures rose 4.75, or 0.3 percent, to 1,940.00.

The Dow fell about 37 points Tuesday, though broader indexes were mixed. Investors were upbeat for much of the day after the Commerce Department said March wholesale sales jumped more than twice than forecast. The jump in sales, coupled with a modest rise in inventories, shows demand and consumer spending are likely to rise in the coming months.

Before last week's tumult, stocks had been climbing nearly nonstop since February on signs of an improving domestic economy.

Investors will get several economic reports this week that should provide more insight into the health of the economy. Reports due out later this week are expected to show initial jobless claims dipped last week, while retail sales, industrial production and consumer sentiment are all rising.

A Commerce Department report Wednesday is expected to show the U.S. trade deficit grew in March, but that exports climbed. That bodes well for manufacturers that sell goods overseas.

Bond prices dipped ahead of an auction for 10-year Treasury notes. The yield on the benchmark 10-year note, which moves opposite its price, rose to 3.54 percent from 3.53 percent late Tuesday.

Prices will often slide just before an auction so investors can buy the new debt at a lower price and receive a higher yield.

Overseas, Germany's DAX index rose 0.9 percent after a report showed its economy grew more than expected in the first quarter. Britain's FTSE 100 fell 0.4 percent and France's CAC-40 gained 0.3 percent. Japan's Nikkei stock average fell 0.2 percent.

[Associated Press; By STEPHEN BERNARD]

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