By Daniela Silberstein
June 24 (Bloomberg) -- U.S. stock futures rose, indicating the Standard & Poor’s 500 Index will climb for a second day, as Oracle Corp. reported better-than-estimated earnings and commodities increased.
Oracle, the world’s second-largest software maker, gained 1.9 percent in Germany as it signaled demand is improving. Alcoa Inc., the biggest U.S. aluminum producer, advanced with higher metal prices. Investors will also watch reports on durable goods, new home sales and commentary from the Federal Reserve for clues on the health of the economy.
“Everything depends on the economic data and what the Fed has to say about the economy,” said Gerold Kuehne, who manages about $115 million in U.S. equities at LLB Asset Management AG in Vaduz, Liechtenstein. “We may extend yesterday’s advance if we have a positive surprise, but the market has risen too much since March to be able to absorb any negative surprises.”
Futures on the S&P 500 expiring in September rose 0.5 percent to 894.80 as of 10:56 a.m. in London. Dow Jones Industrial Average futures climbed 0.5 percent to 8,296, and Nasdaq-100 Index futures increased 0.4 percent to 1,430. Shares in Europe and Asia also advanced.
U.S. stocks gained yesterday as higher oil and metal prices lifted commodity producers and a better-than-estimated auction of Treasury notes eased concern that record government borrowing will boost interest rates.
Signs of Easing
The Organization for Economic Cooperation and Development raised its forecast for the economy of its 30 member nations for the first time in two years as the U.S. slump shows signs of easing. The combined economy of the world’s most-industrialized countries will shrink 4.1 percent this year and grow 0.7 percent in 2010, the OECD said today. The new projections compare with March forecasts for contractions of 4.3 percent and 0.1 percent.
A 40 percent rebound from its 12-year low on March 9 through June 12 left the S&P 500 valued at 14.16 times its companies’ earnings, near the highest level since October. The index has since retreated 5.4 percent.
The measure is poised to resume its rally, according to a technical indicator called the “golden cross” that’s considered a bullish signal by analysts who make predictions based on patterns in price charts.
The 50-day moving average for the S&P 500 exceeded its average price for the prior 200 days yesterday for the first time since December 2007. A 50-day average moving higher than a 200-day average is termed a golden cross by technical analysts.
Oracle, Microsoft
Oracle advanced 1.9 percent to $20.25. Excluding some costs, profit was 46 cents a share in the period ended May 31, the company said. Analysts in a Bloomberg survey had estimated 44 cents on average. Oracle President Safra Catz said customers are showing renewed interest in buying software, a sign they expect the recession to ease up.
Microsoft Corp., the world’s biggest software maker, increased 0.7 percent to $23.50.
Alcoa added 1.2 percent to $10.12 as copper, aluminum, zinc and lead all climbed on the London Metal Exchange. Newmont Mining Corp., the largest U.S. gold producer, advanced 0.9 percent to $41.70.
A Commerce report due at 8:30 a.m. in Washington may show bookings for goods meant to last several years slid 0.9 percent in May, falling for the second time in three months, a sign companies still lack confidence the recession will soon end, a Bloomberg survey of economists showed. Durable-goods orders excluding transportation equipment may have also declined.
Economy Watch
Purchases of new homes rose 2.3 percent in May to an annual pace of 360,000 as prices dropped, according to the median estimate in a Bloomberg survey of economists. The data is scheduled for 10 a.m.
Fed officials will probably seek to reassure investors they can keep short-term interest rates at a record low without igniting inflation. The Fed’s Open Market Committee, concluding a two-day meeting, is scheduled to issue its statement around 2:15 p.m. Policy makers may affirm plans to keep the benchmark federal funds rate in the range of zero to 0.25 percent, economists said.
To contact the reporter on this story: Daniela Silberstein in Zurich at dsilberstei2@bloomberg.net.
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