Stock futures climb on upbeat Intel, CSX earnings

[October 13, 2010]  NEW YORK (AP) -- Upbeat earnings from Intel and CSX helped push stock futures higher Wednesday.

Investors were also preparing for the first earnings report from a big bank as JPMorgan Chase & Co. releases quarterly results.

With earnings releases picking up, traders turned their attention from the Federal Reserve's likely move to stimulate the economy to whether companies can continue to grow even if the recovery is sluggish.

Chipmaker Intel Corp.'s profit and revenue each topped analysts' forecasts. More importantly Intel's results allayed concerns that the personal computer sector will struggle during the second half of the year. Intel had warned about a potential slowdown in sales in August. Its fourth-quarter revenue projections were in line with analysts' expectations during the vital holiday shopping season.

CSX Corp.'s results also topped forecasts, an encouraging sign that at least parts of the economy are growing. The railroad company said shipments rose in the third quarter led by car and truck, coal and international shipments. But CSX also said shipments were flat in consumer goods like food and retail items, an indication that some parts of the economy remain weak.

JPMorgan's results will be closely scrutinized because it this is the first quarter where costs tied to recently passed financial regulatory reform could start to creep into expenses. Consumer loan demand could also provide insight into the strength of the economy.

Ahead of the opening bell, Dow Jones industrial average futures rose 72, or 0.7 percent, to 11,029. Standard & Poor's 500 index futures rose 8.20, or 0.7 percent, to 1,172.70, while Nasdaq 100 index futures rose 16.00, or 0.8 percent, to 2,053.00.

Intel shares rose 23 cents to $20.00 in pre-opening trading.

With traders moving into riskier stocks, bond prices dipped and interest rates rose slightly. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 2.44 percent from 2.43 percent late Tuesday.

Bond prices had been rising in recent weeks as expectations mount that the Fed will start buying Treasurys to further stimulate the economy. Traders have bet bond prices will rise in the short-term because the Fed will add demand to the market.

In an odd twist, stocks have also benefited from the expected move by the Fed because they become more attractive investments over a longer period if bond yields continue to fall.

The Dow is up 2.2 percent in October and has jumped 10 percent since the beginning of September.

Overseas, Britain's FTSE 100 jumped 1.2 percent, Germany's DAX index rose 1.4 percent, and France's CAC-40 gained 1.4 percent. Japan's Nikkei stock average rose 0.2 percent.

[Associated Press; By STEPHEN BERNARD]

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.