Stock futures up sharply after Fed meeting

[November 04, 2010]  NEW YORK (AP) -- Stock futures pushed higher Thursday, a day after the Federal Reserve announced a $600 billion plan to stimulate the economy.

Key market indicators were up more than 0.5 percent ahead of the opening.

The Fed announced Wednesday afternoon that it would buy Treasury bonds in an effort to spur consumer spending and investments in stocks. The central bank was unusually detailed in its announcement, telling investors that it planned to spend $75 billion a month on bonds until at least the middle of next year.

The Dow Jones industrial average has risen about 12 percent since the Fed began hinting in late August that it planned to buy bonds. The extent of the central bank's move was in line with most market estimates.

The announcement is helping to boost share prices overseas as well. The Stoxx 50 index, which tracks blue chip companies in Europe, is up more than 1.1 percent, while shares on the Shanghai Composite index are up 1.8 percent.

The Fed's plan will increase the supply of dollars and most likely push the value of the currency down. The dollar is at its lowest level since December 2009 against a broad basket of currencies.

Finance ministers in emerging economies like China and Brazil have criticized the Fed's stimulus plan and said that the added supply of investment dollars could lead to asset bubbles in their countries.

Dow Jones industrial average futures were up 63, or 0.6 percent, to 11,243 before the opening bell. S&P 500 futures were up 8, or 0.7 percent, while Nasdaq 100 futures were up 11, or 0.5 percent, to 2,175.

The yield on the benchmark 10-year Treasury note, which moves opposite its price, was unchanged at 2.57 percent.

Investors will likely turn their attention to a full plate of economic and corporate earnings reports on Thursday.

The Labor Department will announce its weekly report on first-time unemployment benefit applications before the market opens. Last week, the report showed that unemployment claims dropped slightly.

Kraft Foods Inc., Starbucks Corp. and CBS Corp. will announce their third-quarter earnings reports Thursday as well.

[Associated Press; By DAVID K. RANDALL]

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