Futures gain on Spain aid deal

June 11th, 201211:27 am @


Mon Jun 11, 2012 7:05am EDT

NEW YORK (Reuters) – Stock index futures pointed to gains on Monday, putting Wall Street on track to extend its recent rally after euro zone finance ministers agreed on an aid package to help Spain.

* In the deal, Spain will be lent up to 100 billion euros ($125 billion) in order to help the country’s battered banks. The size of the aid package was larger than expected, removing a huge cloud that has been hanging over financial markets. European shares .FTEU3 gained 1.4 percent.

* Investors have been fearing that a banking crisis in the euro zone’s fourth-largest economy could have compounded the currency bloc’s troubles with Greece.

* Cyclical stocks like energy and financials are likely to rally on the sign of progress in tackling Europe’s debt issues. The sectors are tied to the pace of economic growth, which the debt crisis has called into question. In part because of uncertainty stemming from the euro zone, U.S. companies are finding it more difficult to grow their revenue now than at just about any time since the financial crisis.

* Bank of America Corp (BAC.N) rose 2.2 percent to $7.73 in premarket trading while Citigroup Inc (C.N) added 1.1 percent to $28.08.

* Indonesia has granted permission to Freeport McMoRan Copper Gold Inc (FCX.N) to export unprocessed ore, after the government imposed new rules on mining exports, the company said, sending shares up 1.5 percent to $34.35 in premarket trading.

* SP 500 futures rose 9 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 101 points and Nasdaq 100 futures rose 18 points.

* With the rise, futures pointed to Wall Street extending the previous week’s advance, which was the SP 500’s best of 2012. The week’s gains came after sources told Reuters that Spain was expected to soon ask the euro zone for a bailout.

* In a sobering sign of overseas economic growth, China’s inflation, industrial output and retail sales all flagged in May. It was the second straight month of sluggish growth, which galvanized policymakers last week into taking their boldest action yet to combat a sharpening slowdown.

* Goldman Sachs (GS.N) is close to striking a deal over the sale of its hedge fund administration business with State Street Corp (STT.N), the Financial Times reported. The move would create the largest administration services provider to hedge funds worldwide.

(Editing by W Simon)

Article source: http://feeds.reuters.com/~r/reuters/businessNews/~3/bbfOcCtavi8/us-markets-stocks-idUSBRE84S0BG20120611