Opening View: German Parliament Votes to Expand Euro-Zone Bailout Fund; DJIA Set to Soar


U.S. stocks are set to rebound out of the gate today, as Wall Street cheers the latest developments from across the pond. Specifically, Germany's lower house of parliament followed Finland's lead , voting to approve a proposed expansion to the European Financial Stability Facility (EFSF). The news has helped to overshadow some uninspiring comments from Federal Reserve Chairman Ben Bernanke, who last night called the current unemployment backdrop "a national crisis," and called on Capitol Hill to implement policies that would put people back to work. However, the bulls aren't yet out of the woods, with officials from the European Union ( EU ), European Central Bank (ECB), and International Monetary Fund ( IMF ) slated to converge on Athens to review Greece's compliance with bailout requirements. Nevertheless, the Dow Jones Industrial Average (DJIA) is flirting with a triple-digit lead ahead of the bell, while the broader S&P 500 Index (SPX) is lingering about 9.5 points above fair value.

Dow, S&P and Nasdaq futures

In earnings news, Mosaic (MOS - 57.19) reported a fiscal first-quarter profit of $526 million, or $1.17 per share, up 77% from its year-ago earnings of $297.7 million, or 67 cents per share. Net sales rose 41% to $3.1 billion, while gross margin expanded to 27.5% from 23.1%. "The increase in gross margin and operating earnings was driven primarily by higher selling prices and improved potash operating rates, partially offset by increased phosphates raw material costs," according to a company release. The results were mixed, with analysts looking for a healthier profit of $1.29 per share on just $2.92 billion in revenue. At last check, MOS is headed for a 1.4% rise out of the gate.

Thor Industries, Inc. (THO - 20.31) said its fiscal fourth-quarter profit fell 9.1% to $36.9 million, or 66 cents per share, from $40.6 million, or 78 cents per share, in the year-ago quarter. Net sales, meanwhile, jumped 16% to $770.5 million. Although the company reported a 10% drop in sales of motor homes for the quarter, sales of towable RVs increased by 21%. "We look to RV retail sales to pull through wholesale shipments in the year ahead, and to improving conditions in the 2012 public transportation market to fuel better bus sales," stated Chairman and CEO Peter B. Orthwein. THO's quarterly results just topped analysts' expectations for a profit of 61 cents per share on revenue of $769.1 million.

Finally, Advanced Micro Devices (AMD - 6.15) last night cut its third-quarter revenue guidance and gross margin forecast, citing manufacturing issues at Globalfoundries, a German supplier of its computing chip. Specifically, the firm now expects revenue to rise 4% to 6% sequentially -- about half of its previous projections for an 8% to 12% rise. Meanwhile, AMD now expects gross margins to come in around 44% to 45%, below its previous view for 47%. In pre-market trading, AMD is set to shed 11.4% at the open.

Earnings Preview

Today's earnings docket will also feature reports from Worthington ( WOR ), DemandTec ( DMAN ), Micron Technology ( MU ), AZZ Inc. (AZZ), and Xyratex (XRTX). Keep your browser at for more news as it breaks.

Economic Calendar

The economic agenda heats up with the final second-quarter gross domestic product (GDP) figures, pending home sales data for July, and the usual weekly jobless claims on tap. We'll wrap up the week with reports on personal income and spending for August, the latest Reuters/UMich sentiment index, and the Chicago purchasing managers index (PMI).

Market Statistics

Equity option activity on the Chicago Board Options Exchange (CBOE) saw 625,736 call contracts traded on Wednesday, compared to 521,166 put contracts. The resultant single-session put/call ratio arrived at 0.83, while the 21-day moving average was 0.71.

NYSE and Nasdaq summary

Volatility indices

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Overseas Trading

European indexes are in the red at midday, despite the German parliament's vote in favor of the proposed EFSF expansion. The measure was passed by a wide majority, easing some concerns about Chancellor Angela Merkel's ability to rally the troops -- but traders are keeping a wary eye on Greece, with officials from the EU, ECB, and IMF paying a visit to Athens today to review the country's compliance with bailout requirements. At last check, London's FTSE 100 is off 0.6%, the German DAX is down 0.04%, and the French CAC 40 has slipped 0.1%.

Overseas markets

Currencies and Commodities

The greenback is trading modestly lower this morning, with the U.S. dollar index down about 0.1% at last check. Crude futures, meanwhile, have pared a portion of Wednesday's losses, with the front-month contract up 18 cents, or 0.2%, to trade near $81.39 per barrel. On the flip side, traders continue to take profits on gold, with the malleable metal last seen $2.60, or 0.2%, lower at $1,615.50 an ounce.

Currencies and commodities

Unusual Put and Call Activity:

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Every morning, our research staff analyzes the prior day and the overnight markets, and monitors the morning wires to give you an accurate preview of the day to come. If you enjoyed today's edition of Opening View, sign up here for free daily delivery, straight to your inbox, before the opening bell.

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This article appears in: Investing , Options

Referenced Stocks: DMAN , EU , IMF , MU , WOR

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