By William Watts and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- U.S. stock-index futures rose Monday,
inspired by merger news and gains from European markets, which rose
on hints of more stimulus from European Central Bank President
Mario Draghi.
New-home sales data may help set the tone later in the day,
while shares of Burger King Worldwide Inc. and InterMune Inc. were
on track for gains on deal news.
Futures for the Dow Jones Industrial Average (DJU4) rose 56
points, or 0.3%, to 17,049, while S&P 500 index futures (SPU4)
gained 7.7 points, or 0.4%, to 1,995.20. Nasdaq 100 index futures
(NDU4) added 16.25 points, or 0.4%, to 4,071.
Stocks closed lower on Friday, with both the S&P 500 (SPX)
and Dow industrials (DJI) snapping four-day winning streaks. For
the week, both the Nasdaq Composite (RIXF) and the S&P 500 rose
1.7%, while the Dow industrials rose 2%.
Stock index futures held gains after the Chicago Fed's national
economic activity index for July rose to 0.39 from 0.21. Readings
above zero indicate above-trend growth.
Data on new home sales for July are due at 10 a.m. Eastern. Also
read Economic Preview: Double-sided U.S. economy
Draghi 'whatever it takes' part 2: Inspiration for Monday's
gains came in part from stronger European markets, with the Stoxx
Europe 600 index up 0.7%. Dovish comments Friday by Draghi
increased speculation that another easing move from the central
bank is coming.
Draghi's comments, which came after European markets had closed,
and a speech by Federal Reserve Chairwoman Janet Yellen were
brushed aside by Wall Street on Friday. Yellen stayed largely cagey
about the timing of the next rate hike in the U.S.
"[Draghi] was dovish and, to a certain degree, while Yellen and
the rest of the Fed members are preparing for a rate hike next
year, the tone is still that of easy money and so if you have a
flow of easy money coming out of Europe, that is going to help
equity markets here in the States as well," said Peter Cardillo,
chief market economist at Rockwell Global Capital.
Stocks to watch: Shares of Burger King Worldwide Inc.(BKW)
jumped more than 16% in premarket trade after the company said it
is in talks to buy Canadian coffee-and-doughnut chain Tim Hortons
Inc. (THI). The deal would be set up as a so-called tax inversion,
moving Burger King's tax base to Canada. U.S.-listed shares of Tim
Hortons rose more than 17% in premarket action. (Read more about
Monday's biggest-moving stocks
http://www.marketwatch.com/story/apple-goldman-are-stocks-to-watch-on-monday-2014-08-24.).
Shares of InterMune Inc. (ITMN) soared more than 36% in
premarket action after Swiss-based Roche Holding AG (RHHBY) said
Sunday it will pay $8.3 billion for the California biotech
firm.
Shares of Ann Inc. rose nearly 3% in premarket action after
activist investor Engine Capital LP called on the parent of
clothing retailer Ann Taylor to sell itself.
Goldman Sachs Group Inc. (GS) may also draw attention after the
investment bank agreed late Friday to a settlement worth more than
$1.2 billion over claims it failed to disclose risks on mortgage
banks it sold before the financial crisis hit.
Other markets: Monday is a holiday in the U.K. In Asia, the
Nikkei 225 index rose. The euro (EURUSD) fell against the dollar on
the suggestion of more ECB easing as well as a survey that showed
weaker German business confidence.
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