U.S. Stock Futures Advance; Citigroup, American Express Climb

By Adria Cimino

Nov. 3 (Bloomberg) -- U.S. stock futures advanced as lower money-market rates lifted financial shares, offsetting concern a report today may show manufacturing contracted in October at the fastest pace since the 2001 recession.

Citigroup Inc. and American Express Co. rose at least 1 percent in Germany on signs that as much as $3 trillion of emergency funds provided by governments to alleviate the credit crisis may be easing interbank lending. Boeing Co. fell after Goldman Sachs Group Inc. added the stock to its ``conviction sell'' list. Motorola Inc. slipped as Merrill Lynch & Co. cut its recommendation on the shares.

Standard & Poor's 500 Index futures expiring in December advanced 0.4 percent to 971.2 as of 11:57 a.m. in London. Dow Jones Industrial Average futures gained 0.5 percent to 9,344 and Nasdaq-100 Index futures were little changed.

The S&P 500 sank 17 percent last month and closed at a five- year low on Oct. 27. The October sell-off erased more than $9.5 trillion from the value of stocks worldwide, almost one-third of the total value wiped out this year, as credit-related losses and writedowns by financial firms approached $700 billion.

The Institute for Supply Management's factory index dropped to 41.5 last month from 43.5 in September, according to the median estimate in a Bloomberg News survey. The report is due for release at 10 a.m. New York time.

Polls show Democrat Barack Obama ahead of Republican John McCain as the economy looms as the main concern among voters. Obama, 47, widened his lead to 8 percentage points over McCain, 72, in an average of polls released in the last week, according to RealClearPolitics.com.

Election History

Election history indicates that U.S. stocks have a better chance in the first year of an Obama presidency than a McCain administration.

Since 1900, the Dow average rose 9.8 percent in the 12 months after the Democratic Party captured the White House, based on the median change following the election of seven Democrats from Woodrow Wilson to Bill Clinton. Only twice did the index drop, after Wilson's victory in 1912 and Jimmy Carter's in 1976.

Citigroup, the second-largest U.S. bank, added 1.5 percent to $13.86 in Germany. American Express, the nation's biggest credit-card company by purchases, gained 1.5 percent to $27.90.

The London interbank offered rate, or Libor, that banks charge for three-month loans in dollars dropped 17 basis points to 2.86 percent, the lowest level since the collapse of Lehman Brothers Holdings Inc. on Sept. 15. It was the rate's 16th consecutive drop, according to the British Bankers' Association.

General Motors

General Motors Corp., the biggest U.S. automaker, added 3.8 percent to $6.01 in Germany. Crude oil fell, giving up earlier gains, as reduced imports by Asian refiners reinforced concerns that a demand slowdown is spreading to emerging markets.

Separately, merger talks with Chrysler LLC may intensify this week as the companies wait to see whether the U.S. will provide financial aid to help complete the deal, people familiar with the matter said.

U.S. stocks staged their steepest weekly surge in 34 years after the Federal Reserve's interest-rate cut and signs the credit crisis is ebbing boosted equities trading at the lowest valuations in two decades.

Boeing, the world's second-largest commercial-aircraft maker, slipped 0.6 percent to $52.11. Goldman added the stock to its ``conviction sell'' list.

``There is no change to the cyclical and weakening economic fundamentals behind our cautious view,'' analyst Richard Safran wrote in a research note dated today.

Motorola lost 0.6 percent to $5.34. The stock was downgraded to ``neutral'' from ``buy'' at Merrill, which said overhauling the company's mobile-phone business may take longer and be riskier than originally predicted.

Halliburton Co. fell 1.4 percent to $19.52. The world's second-largest oilfield-services provider was cut to ``neutral'' from ``buy'' at Goldman, which cited ``product risks and valuation'' in a note to clients.

To contact the reporter on this story: Adria Cimino in Paris at acimino1@bloomberg.net.