Wall Street's guarded optimism seems to be strengthening as the Fed decision day approaches. Sentiment also got a shot in the arm from the German court ruling, which approved the ESM, albeit with some conditions. The court decision has perked up risk appetite further, as has been seen in the rally witnessed by risk asset classes. With very little macroeconomic trigger to influence trading, the upward momentum could be sustained, although the overbought levels and potential re-ignition of Fed stimulus worries could render the mood lackluster.
As of 6:30 am ET, the Dow futures are adding 73 points, the S&P 500 futures are moving up 7.90 points and the Nasdaq 100 futures are gaining 20.50 points.
U.S. stocks stayed afloat on Tuesday, as stimulus hopes lent support to the markets. The Dow Industrials ended up 69.07 points or 0.52 percent at 13,323 and the S&P 500 Index closed at 1,434, up 4.48 points or 0.31 percent. Meanwhile, the Nasdaq Composite Index closed 0.50 points or 0.02 percent higher at 3,105.
On the economic front, a 2-day FOMC meeting is scheduled to begin on Wednesday.
The export & import price indexes for August are due out at 8:30 am ET. The consensus estimates call for a 1.5 percent month-over-month increase in import prices and a 0.5 percent rise in export prices. In July, export prices fell 0.6 percent, while export prices rose 0.5 percent.
The Commerce Department is due to release its wholesale inventories report at 10 am ET. Economists expect wholesale inventories at the end of July to show a 0.4 percent increase compared to a 0.2 percent drop in June.
The Energy Information Administration is scheduled to release its weekly petroleum inventory report for the week ended September 7th at 10:30 AM ET. The API inventory report released late Tuesday showed that crude oil stockpiles rose by 221,000 to 359 million in the week ended September 7th. Gasoline inventories fell by 4.16 million barrels, while distillate stockpiles rose by 2.55 million barrels.
In corporate news, Apple (AAPL) is expected to be in the spotlight as the company is expected to unveil its latest version of iPhone, which is widely believed to be named as iPhone 5.
Steel Dynamics (STLD) said it expects third quarter earnings of 1-5 cents per share, reflecting charges related to its recent financing and impairment. Before these charges, the company expects earnings of 9-14 cents per share, down both sequentially and year-over-year, as global and political uncertainty impact consumer confidence and inventory destocking impacts shipment.
In its mid-quarter update, Texas Instruments (TXN) said it expects third quarter earnings of 38-42 cents per share compared to its earlier estimate of 34-42 cents per share. The company narrowed its revenue guidance to $3.27 billion to $3.41 billion from $3.21 billion to $3.47 billion. Analysts estimate earnings of 45 cents per share on revenues of $3.34 billion.
Most Asian markets closed higher, as positive domestic data and optimism ahead of the FOMC meeting gave reasons for traders to stay invested in stocks.
Japan's Nikkei 225 average closed up 152.58 points or 1.73 percent at 8,960. The yen's retreat amid the rise in risk aversion supported export dependent stocks. Australia's All Ordinaries hovered in positive territory throughout the session before closing up 34.80 points or 0.80 percent at 4,383. Hong Kong's Hang Seng Index closed at 20,075, up 217.51 points or 1.10 percent.
On the economic front, a report released by Japan's Cabinet Office showed that core machinery orders rose 4.6 percent month-over-month in July compared to expectations for a 2 percent increase. On a year-over-year basis, core machinery orders climbed 1.7 percent, belying expectations for a 3.6 percent drop.
The major European markets are higher following the German constitutional court ruling, which approved the ESM with conditions. The court limited Germany's participation in the ESM to 190 billion euros.
Consumer price inflation report released by INSEE showed that French EU harmonized consumer price index rose 2.4 percent year-over-year, ahead of the 2.2 percent rate in July and the 2.3 percent rate forecast by economists.
Meanwhile, German annual inflation measured in harmonized terms came in at a unrevised 2.2 percent in August, according to revised estimates released by the Federal Statistical Office. Economists expected a 2 percent increase.
According to a report released by the U.K. Office for National Statistics, claimant count fell by 15,000 in August compared to expectations for an unchanged reading. The unemployment rate based on the ILO standards for the 3 months ended July came in at 8.1 percent, slightly above expectations for 8 percent.
by RTT Staff Writer
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