Forexpros - U.S. stock futures pointed to a sharply higher open
on Monday, as fears over a possible U.S. default eased after U.S.
Congressional leaders reached an agreement to raise the U.S. debt
Dow Jones Industrial Average futures pointed to a gain of 0.9%, the
S&P 500 futures climbed 1%, while the Nasdaq 100 futures
Late on Sunday, President Barack Obama announced a deal between
Republicans and Democrats to cut spending and raise the USD14.3
trillion debt ceiling, easing worries about a possible sovereign
Under the framework deal, which was to be voted on in Congress
later in the day, the debt ceiling will be raised by at least
USD2.1 trillion, sufficient to serve the government's needs into
Shares in the financial sector, many of which have large exposure
to U.S. treasuries performed strongly in pre-market trade.
The largest U.S. lender Bank of America saw shares rally 3.5%,
Citigroup shares rose 2%, while shares in JP Morgan Chase climbed
U.S. listed shares of Europe's largest bank HSBC Holdings rose 4%
after reporting better-than-expected first half earnings. The
lender said that it planned to cut nearly 5,000 jobs as part of a
plan to save up to USD3.5 billion by 2013.
Health insurer Humana saw shares surge 6.5% after it reported a 35%
increase in second quarter profit. The upbeat results prompted the
company to raise its full-year earnings forecast.
Shares in consumer electronics retailer RadioShack jumped 6.3%
after Goldman Sachs added it to its 'Conviction Buy' list.
Meanwhile, shares in the largest publicly traded U.S. home and auto
insurer Allstate could be active after it swung to a second quarter
loss of USD642 million, as natural disaster-related losses jumped
to USD2.34 billion. The stock did not trade ahead of the open.
Across the Atlantic, European stock markets were higher. The EURO
STOXX 50 added 0.35%, France's CAC 40 advanced 0.5%, Germany's DAX
rose 0.55%, while Britain's FTSE 100 jumped
During the Asian trading session, Japan's Nikkei 225 Index surged
1.3%, while Hong Kong's Hang Seng Index climbed 1% as market
sentiment was bolstered after the White House announced an
agreement to raise the U.S. debt ceiling had been reached.
Later in the day, the U.S. Institute of Supply Management was to
publish data on manufacturing activity.