Business

Wall Street set to rise as China data spurs growth hopes

File photo of traders monitoring numbers on Wall Street. — Reuters picFile photo of traders monitoring numbers on Wall Street. — Reuters pic

Data showed China's export growth rebounded sharply to a seven-month high in December, a strong finish to the year after seven straight quarters of slowdown, even as demand from Europe and the United States remained subdued.

Ford Motor shares gained 3.1 per cent to US$13.89 (RM42.04) in premarket trading after it doubled its first-quarter dividend to 10 cents a share, despite a recent drop in market share.

Adding to the bullish sentiment, Spanish benchmark government bond yields fell below 5 per cent to a 10-month low on the back of a strong bond auction that raised more than the targeted amount.

"The market's more positive and it owes a lot of that to the Chinese economic data," said Art Hogan, managing director of Lazard Capital Markets in New York, adding that the success of the Spanish auction was also of note.

S&P 500 futures rose 7.7 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 rose 45 points, and Nasdaq 100 futures added 18 points.

Data showed new claims for unemployment benefits rose last week, though seasonal volatility made it difficult to get a clear picture of the labor market's health. The market's reaction to the data was muted.

Looking ahead, traders await the release of wholesale inventories data for November by the Commerce Department at 10:00 a.m. ET (1500 GMT). Economists expect inventories to rise 0.3 per cent, against a 0.6 per cent increase in October.

Several Federal Reserve speakers are due to speak Thursday, including Kansas City Fed President Esther George and St. Louis Fed President James Bullard. Market participants are likely to pay close attention to their remarks following indications, in the minutes of the latest Fed meeting, that the Fed may halt its highly stimulative asset purchases this year. The program has been one of the pillars of the strength in the equity market.

Shares of upscale jeweler Tiffany dropped 8 per cent to US$58.21 in premarket trading after it said earnings for the year through Jan. 31 will be at the lower end of its forecast.

Molycorp shares dropped 13 per cent to US$9.39 in premarket trading after the company said revenue and cash flow would be lower than expected this year due to lower rare-earth prices.

US-traded Nokia shares jumped 18 per cent to US$4.43 after the Finnish handset maker said its fourth-quarter results were better than expected and that the mobile phone business achieved underlying profitability. — Reuters

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