With traders reacting positively to the latest news out of Europe, stocks are likely to move to the upside in early trading on Friday. The major index futures are currently pointing to a sharply higher open, with the Dow futures up by 194 points.
The substantial upward momentum for the markets comes after European Council President Herman Van Rompuy announced that European leaders have agreed to spend 120 billion euros on a package of measures to stimulate growth and create jobs.
Van Rompuy said the leaders also agreed to permit the European Financial Stability Facility and the European Stability Mechanism to directly recapitalize ailing banks after a single European banking regulator is commissioned.
Additionally, the leaders agreed that ESM loans to Spanish banks will not have senior creditor status. The European Central bank is set to act as an agent for the rescue funds in market operations.
In U.S. economic news, the Commerce Department recently released a report showing that personal income rose by 0.2 percent in May, matching the increase seen in the previous month. Economists had expected income to increase by 0.3 percent.
The report also showed that personal spending came in unchanged in May after edging up by a revised 0.1 percent in April. Spending had been expected to come in unchanged compared to the 0.3 percent increase originally reported for the previous month.
Despite the strong upward momentum for the broader markets, shares of Research in Motion (RIMM) are likely come under pressure in early trading after the BlackBerry maker reported weaker than expected first quarter results and provided disappointing guidance.
by RTT Staff Writer
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