U.S. Stock Futures Gain on Crisis Talks Progress

By Adria Cimino - Oct 24, 2011 5:47 PM GMT+0700

U.S. stock futures erased their gains, leaving the benchmark Standard & Poor’s 500 Index little changed.

Caterpillar Inc. (CAT) advanced and Texas Instruments Inc. (TXN) slipped in Germany before reporting earnings. Garmin Ltd. (GRMN) rallied after rival TomTom NV raised its forecast.

S&P 500 futures expiring in December lost less than 0.1 percent to 1,235.1 at 6:45 a.m. in New York. Futures on the Dow Jones Industrial Average slipped 2 points, less than 0.1 percent, to 11,755.

The S&P 500 ended last week at the highest level since Aug. 3, two days before S&P stripped the U.S. of its AAA credit rating, amid optimism Europe’s leaders would announce a plan to contain the debt crisis. The stock index has surged 13 percent since Oct. 3, when it closed within 1 percent of a bear market, or a plunge of 20 percent from its high in April.

Euro-area leaders ruled out tapping the European Central Bank to boost the region’s rescue fund as they inched toward a revamped strategy to contain the debt crisis. The 13th crisis- management summit in 21 months excluded a forced restructuring of Greece’s debt, sticking with the policy of enticing bondholders to accept “voluntary” losses to help restore the country’s finances. The complete blueprint will be formed at a second summit Oct. 26.

‘Decision Time’

“Let’s hope this is decision time in Europe,” Richard Sichel, who oversees $1.6 billion as chief investment officer at Philadelphia Trust Co., said in a telephone interview. “Maybe this time we’ll actually hear something that we can say, ‘OK, now we know and let’s go from there.’ We need to put this crisis behind us and get back to looking at U.S. corporate earnings.”

The S&P 500 rose 9.4 percent this month through Oct. 21, following five months of losses. Gauges of commodity, consumer discretionary and industrial companies, which are most-tied to economic growth, added at least 11 percent. The U.S. economy probably grew in the third quarter at the fastest pace this year, economists said before a report this week.

This week, 191 companies in the S&P 500 will report quarterly results. Profit for all companies in the index climbed 16 percent during the third quarter, and will increase 18 percent to a record $99.32 a share for all of 2011, according to analyst estimates compiled by Bloomberg. About three quarters of the S&P 500 companies that reported results since Oct. 11 beat analysts’ projections, the data showed.

Caterpillar Earnings

Caterpillar, the biggest construction and mining-equipment maker, rose 0.5 percent to $87.80 in Germany. The company may say third-quarter profit rose to $1.58 a share from $1.22 a share a year earlier, according to a Bloomberg survey of analysts.

Texas Instruments, the largest maker of analog chips, slipped 0.1 percent to $30.43 in Germany. The company may report third-quarter earnings of 58 cents a share versus 71 cents a share, a Bloomberg survey showed.

Caterpillar will report earnings before the stock market opens and Texas Instruments will report after the close.

Garmin, the biggest maker of mobile navigation systems in the U.S., rallied 0.7 percent to $34.84 in Germany. TomTom, Europe’s biggest maker of portable navigation devices, reported third-quarter profit that beat analyst estimates and raised its forecast.

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

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net