U.S. Stock-Index Futures Advance; Citigroup Climbs in Europe

By Adam Haigh

Sept. 17 (Bloomberg) -- U.S. stock-index futures rose as speculation a report today may show housing starts increased in August overshadowed lower-than-estimated sales at Oracle Corp.

Citigroup Inc. climbed 4.8 percent in Germany before the Commerce Department’s figures. Oracle declined 1.9 percent after first-quarter revenue at the world’s second-largest software maker missed analysts’ projections, hurt by slowing demand for databases.

Futures on the Standard & Poor’s 500 Index expiring in December added 0.2 percent to 1,066 as of 10:53 a.m. in London, after falling as much as 0.1 percent earlier. The index closed at the highest level since Oct. 3 yesterday. Dow Jones Industrial Average futures rose 0.3 percent to 9,754 today, while Nasdaq-100 Index futures advanced 0.2 percent to 1,721.75.

Speculation that government measures will help revive the economy and better-than-estimated earnings at companies from Goldman Sachs Group Inc. to Johnson & Johnson spurred a 58 percent rally in the S&P 500 from its 12-year low on March 9.

“I expect some consolidation,” said Christoph Riniker, an equity strategist at Bank Julius Baer in Zurich. “The overall outlook is quite good in the medium term for equity markets, but after this sharp rise we’ve had since March that consolidation would be healthy for markets.”

Citigroup, the biggest user of U.S. government debt guarantees extended under last year’s bank rescue, climbed 4.8 percent to $4.40 in Germany. Bank of America Corp., which bought Merrill Lynch & Co. last year, rose 0.7 percent to $17.37.

Oracle Sales

The Federal Reserve has kept its target rate for overnight lending between banks at near zero to unlock credit markets after the bankruptcy of New York-based Lehman Brothers Holdings Inc. last September.

Oracle slid 1.9 percent to $21.71. Sales of database and so-called middleware programs plunged 22 percent to $711 million in the period ended Aug. 31, the company said yesterday. That compares with the $826 million estimate of Patrick Walravens, an analyst with JMP Securities Inc. in San Francisco.

Housing starts climbed 2.9 percent to an annual rate of 598,000, according to the median forecast of 74 economists in a Bloomberg News survey. The Commerce Department report is due at 8:30 a.m. in Washington.

At the same time, data from the Labor Department are projected to show that the number of Americans filing claims for jobless benefits increased to 555,000 last week from 550,000 the prior week.

Economy Watch

The Philadelphia Fed at 10 a.m. may say manufacturing activity in its region grew for a second consecutive month in September after contracting in the 10 previous months. The bank’s index probably rose to 8, according to economists surveyed, from 4.2 in August.

Paul Volcker, the former Fed chairman who’s an economic adviser to President Barack Obama, said there’s a “long way to go” before the economy returns to pre-recession levels.

“It will be a long slog -- a matter of years -- with the risk of some relapses along the way,” Volcker said yesterday at a financial conference in Beverly Hills, California.

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net.