After the drubbing received by the markets in the past week, Wall Street stocks may well be on a recovery path on Monday. The index futures currently point to a notably higher opening. That said, the markets may have to navigate through some key events to cement its rebound attempt. Traders may remain cautious about the 2-day FOMC meeting that gets underway on Tuesday and also focus on the 2-day G-8 meeting ending on Tuesday. Additionally, the results of a regional manufacturing survey that gives the first glimpse of manufacturing conditions in June and the results of a homebuilder confidence survey may also chart the course of the markets.
As of 6:15 pm ET, the Dow futures are climbing 136 points, the S&P 500 Index futures are jumping 15.40 points and the Nasdaq 100 futures are advancing 30.50 points.
U.S. stocks reversed course and declined in the week ended June 14th, as traders remain wary of how central banks are going to react to the fickle recovery that is underway. Economic data released during the week also did not offer much help in resolve the uncertainty.
On the economic front, the 2-day FOMC meetings along with a few housing and manufacturing reports are likely to headline the economic events of the unfolding week. Traders are likely to closely watch the FOMC announcement on Wednesday, which would be followed by the release of the FOMC forecasts and the Chairman's press briefing.
The results of the New York Federal Reserve and the Philadelphia Federal Reserve's manufacturing surveys for June, the jobless claims report, the National Association of Home Builders' housing market index for June, the Commerce Department's housing starts report for May and the National Association of Realtors' existing home sales report for May are also likely to be in the spotlight. The Labor Department's consumer price report for May, the Conference Board's leading indicators index for May and announcements concerning the Treasury auctions of 2-year, 5-year and 7-year notes round up the economic events of the week.
The New York Federal Reserve is scheduled to release the results of its manufacturing survey for June at 8:30 am ET. The consensus expectations call for an increase in the general business activity index based on the survey to 0.50 from 1.43 in May.
At 10 am ET, the National Association of Home Builders is scheduled to release its housing market index for June. Economists expect the index to rise to 45 from 44 in May.
In corporate news, Weyerhaeuser (WY) announced its decision to buy Longview Timber from Brookfield Asset Management for $2.65 billion, including the assumption of debt. Separately, the company announced that its board has authorized the exploration of strategic alternatives with respect to its Weyerhaeuser Real Estate. The company also announced separately that its board has elected Doyle Simons to succeed Dan Fulton, who will retire as CEO, effective August 1st.
Meanwhile, Brookfield also signed a separate deal to sell its interest in its U.S. Pacific Northwest timberland operations for about $790 million, with the seller assuming proportionate debt of about $320 million, resulting in a net proceeds of about $470 million.
Rockwood Holdings (ROC) said that it has agreed to sell its German ceramic materials business CeramTec to European private equity firm Cinven Partners LLP for gross proceeds of 1.49 billion euros, or $1.98 billion.
The major Asian markets closed mostly higher, with the exception of China and South Korea. The Japanese market led the advance, with the Nikkei ending up close to 3 percent.
Japan's Nikkei 225 closed up 346.60 points or 2.73 percent at 13,033. A majority of stocks advanced, with only real estate stocks coming under selling pressure. Australia's All Ordinaries closed 29.50 points or 0.62 percent higher at 4,805. Financial stocks advanced strongly, while utility, healthcare and consumer staple stocks also found buying interest, while material stocks came under selling pressure.
Hong Kong's Hang Seng Index closed at 21,226, up 256.76 points or 1.22 percent. On the other hand, China's Shanghai Composite Index and South Korea's Kospi fell 0.27 percent and 0.32 percent, respectively.
On the economic front, a report released by Japan's Ministry of Economy, Trade and Industry showed that its tertiary index measuring activity of the service sector came in unchanged compared to the previous month in April, defying expectations for a 0.2 percent increase. India's Reserve Bank of India opted to hold key policy rates unchanged at the conclusion of its mid-quarter review. The central bank left repo rate at 7.25 percent, reverse repo rate at 6.25 percent and the cash reserve ratio at 4 percent. The no changed stance came after the Reserve Bank of India reduced these rates thrice this year to steady sagging growth.
European stocks opened higher and have advanced further. The French CAC 40 Index and the German DAX Index are rising over 1 percent each, while the U.K.'s FTSE 100 Index is gaining moderately.
In corporate news, Swedish engineering giant ABB (ABB) announced the appointment of Ulrich Spiesshofer as its CEO, effective September 15th. Spiesshofer will replace Joe Hogan, who earlier in May announced his intention to resign. Royalty Pharma released a letter from its Chairman Rory Riggs, where he indicated that Elan's (ELN) shareholders are likely to reject both the Theravance and AOP deals at the EGM.
The asking price for a property in the U.K. rose to a fresh record high in June, lifted by a jump in prices in the South East and London, the latest survey by Rightmove showed.
Eurozone' s trade surplus narrowed to EUR 14.9 billion in April from EUR 22.5 billion in March, Eurostat said. The surplus amounted to EUR 3.3 billion a year earlier.
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