U.S. stock futures are pointed higher this morning, as investors await the results of the Institute for Supply Management's ( ISM ) non-manufacturing report for November, as well as factory-orders data for October, both slated for release at 10 a.m. All eyes remain firmly on Europe, as signs begin to emerge of concrete austerity measures for Italy. Specifically, Prime Minister Mario Monti announced a three-year package designed to stimulate growth and cut spending. Furthermore, investors appear optimistic ahead of a meeting between German Chancellor Angela Merkel and French President Nicolas Sarkozy, which precedes the end-of-the week European Union ( EU ) summit . Against this backdrop, the Dow Jones Industrial Average (DJIA) is trading 132 points above fair value, and the S&P 500 Index (SPX) is looking at a 16-point jump.
Over the weekend, Germany's SAP AG (SAP - 59.54) agreed to buy online software provider SuccessFactors (SFSF - 26.25) for $3.4 billion, or $40 per share -- representing a premium of 52% to the stock's closing price on Friday. SAP said it expects the deal to be slightly dilutive to its adjusted per-share earnings in 2012, but accretive in subsequent years. The deal is expected to close in the first quarter of next year. "The combination of SAP and SuccessFactors will create a cloud powerhouse," said Bill McDermott, SAP's co-CEO. Shares of SAP are trading 1.6% lower ahead of the bell, while SFSF is up 52% to trade at $39.92.
In earnings news, Dollar General (DG - 39.94) recorded a third-quarter profit of $171.2 million, or 50 cents per share, a 34% jump over last year's profit of $128.1 million, or 37 cents per share. Excluding items, earnings rose to 50 cents from 39 cents per share. Revenue rose 11.5% to $3.6 billion. The results came in better than expected, as analysts, on average, were predicting earnings of 47 cents per share on revenue of $3.57 billion. Looking ahead, DG raised its full-year earnings forecast to a range of $2.29 to $2.32 per share. In addition, the company's board approved a new stock buyback plan of up to $500 million. DG is up 1.3% ahead of the bell.
The economic calendar kicks off today with the Census Bureau's latest data on factory orders, as well as the Institute for Supply Management's ( ISM ) non-manufacturing index. While Tuesday's agenda is bare, Wednesday will bring us the usual crude inventories stats, along with the Federal Reserve's monthly consumer credit report. On Thursday, the regularly scheduled report on first-time jobless claims will hit the Street, as well as the government's wholesale inventories data. Finally, Friday rounds out the week with Uncle Sam's monthly trade balance report and the Thomson Reuters/University of Michigan consumer sentiment index.
Equity option activity on the Chicago Board Options Exchange ( CBOE ) saw 925,434 call contracts traded on Friday, compared to 544,530 put contracts. The resultant single-session put/call ratio arrived at 0.59, while the 21-day moving average was 0.71.
Most Asian markets ended higher today, as new austerity plans out of Italy sparked some optimism regarding the euro zone's debt crisis. Among individual equities, Samsung was a standout in Seoul after winning a court victory against patent rival Apple. However, stocks in China ended lower, sitting out the regional rally after HSBC's purchasing managers index (PMI) pointed to slower growth in the services sector during the month of November. By the close, China's Shanghai Composite fell 1.2%, South Korea's Kospi added 0.4%, Japan's Nikkei rose 0.6%, and Hong Kong's Hang Seng tacked on 0.7%.
The bulls are also making their presence known in Europe, where equities have started the week on a solid footing. Traders were initially encouraged by Mario Monti's new belt-tightening budget, and expectations are also running high as Nicolas Sarkozy and Angela Merkel convene in Paris to discuss a plan of attack for this Friday's EU summit. At midday, London's FTSE 100 is up 0.8%, the German DAX has added 0.9%, and France's CAC 40 has gained 1.5%.
Currencies and Commodities
The U.S. dollar index is trading 0.2% lower this morning, with the greenback last seen at $78.46. Crude oil, meanwhile, is hoping to extend last week's gains, with the front-month contract up 0.6% at $101.60 per barrel. Gold futures, on the other hand, are taking a breather, as the malleable metal is looking at a 0.5% drop to sit at $1,743.50 per ounce.
Unusual Put and Call Activity:
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