By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
Consumer spending, core inflation en route
NEW YORK (MarketWatch) -- A rise in U.S. stock futures pointed
to an upbeat session on Wall Street Monday, as investors welcomed
dovish comments from Federal Reserve Chairwoman Janet Yellen and
China's central-bank chief lent support to the bulls.
Investors assessed data on consumer spending and personal
income, which pointed to a slowing rate of spending and higher
rates of saving among Americans.
Futures for the Dow industrials (YMM5) rose 120 points, or 0.7%,
to 17,749, while those for the S&P 500 index (ESM5) added 11
points, or 0.5%, to 2,063.50. Coming out ahead, futures for the
Nasdaq-100 index (NQM5) gained 26.50 points, or 0.6%, to
4,353.25.
Given how negative last week was for stocks, a strong move
higher isn't too surprising, said Craig Erlam, senior market
analyst at Oanda.
"The dovish comments from both Fed Chairwoman Janet Yellen and
People's Bank of China Governor Zhou Xiaochuan are giving markets a
big lift, and in the absence of negative data or news, I imagine
this will continue to buoy the markets throughout the session,"
Erlam said in emailed comments.
At the tail end of Wall Street's day on Friday, Yellen said
gradual hikes are likely this year, but that the central bank will
move cautiously, speaking at a conference sponsored by the San
Francisco Fed.
And speaking on Sunday, the PBOC governor said
(http://www.marketwatch.com/story/china-central-bank-chief-warns-of-us-dollar-strength-2015-03-29)
he saw "more room" for China to ease policy if the economy stays
soft and inflation continues to weaken. On Monday, Chinese stocks
closed at a seven-year high
(http://www.marketwatch.com/story/chinese-stocks-rally-on-silk-road-details-2015-03-30).
Read: If the Fed doesn't hike rates, it will be due to one of
these charts ()
()Gains weren't limited to stock futures, as the Stoxx Europe
600 index rallied Monday, with the benchmark up by nearly 1%.
Yellen's comments triggered modest gains for Wall Street on
Friday, though overall, it was another down week for markets.
Standing out, the Nasdaq Composite (RIXF) finished the session 0.6%
higher, though it posted the biggest weekly decline since Oct. 10,
2014. The S&P 500 (SPX) and Dow industrials (DJI) each closed
up 0.2%, but suffered the biggest weekly declines since the end of
January.
()Big week for data: This shortened week for investors will
still see nonfarm-payrolls data arrive on Friday, when markets are
closed.
U.S. consumers barely increased spending in February in another
signal that the economy slowed in the first quarter. Personal
incomes, meanwhile, rose for the fourth time in a five months and
the saving rate climbed for the third straight month.
Read: What happens when the jobs report is released on Good
Friday
(http://www.marketwatch.com/story/what-happens-when-jobs-report-is-released-on-good-friday-2015-03-27)
Yellen said Friday that the central bank would be
"uncomfortable" raising rates if consumer prices, wage growth and
other measures of underlying inflation were to weaken.
At 10 a.m. Eastern Time, pending home sales for February are due
for release.
Stocks to Watch: Shares of Catamaran Corp.(SXCI) surged 25% in
premarket after UnitedHealth Group Inc.(UNH) said it would buy the
pharmacy-benefit manager for around $12.8 billion in cash.
Teva Pharmaceutical Industries Ltd.(TEVA) on Monday announced an
agreement to buy Auspex Pharmaceuticals Inc.(ASPX) in a deal valued
at $3.2 billion. Teva rose 1.7% in premarket, though Auspex wasn't
yet active.
Cal-Maine Foods Inc.(CALM)(CALM) reported sales grew 11% in the
third quarter due to increased demand, especially for specialty
eggs, over the holiday period.
AAR Corp. (AIR) will also report on Monday.
Other markets: U.S. crude-oil prices
(http://www.marketwatch.com/story/iran-talks-keep-crude-oil-futures-under-pressure-in-asia-2015-03-30-31032459)
fell 69 cents to $48.18 a barrel (CLK5) , while gold
(http://www.marketwatch.com/story/gold-loses-ground-again-as-data-anticipation-builds-2015-03-30)
prices (GCJ5) dropped $16.40 to $1,108.30 an ounce. The dollar
(http://www.marketwatch.com/story/dollar-inches-up-against-euro-yen-as-big-data-week-kicks-off-2015-03-30)(DXY)
was mostly steady against rivals.
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