Futures Edge Up, Treasurys in Focus
U.S. stock index futures edged higher ahead of the open Wednesday as investors braced for an auction of government debt following a weak Treasury auction on Tuesday.
Stocks ended mixed in the previous session, as the Dow reached a new 28-month high.
The government's sale of five-year notes garnered the lowest demand since June, sending prices lower and yields higher. Weak readings from the Standard & Poor's Case-Shiller home price index and consumer sentiment data added to the lackluster reception and sparked fears the benchmark U.S. bonds were losing their appeal among investors.
Wednesday's auction of 7-year notes was expected to raise $29 billion with results due shortly after 1 p.m.
The Mortgage Bankers Association's weekly report on mortgage applications will not be released today as usual because of the holiday week. Data for the week ended Dec. 24 will be released along with data for the week ended Dec. 31 on Wednesday, Jan. 5
Oil slipped to just above $91 a barrel on Wednesday as weather warmed in the Northeast. The dollar was trading flat against a basket of currencies, aided by higher U.S. bond yields, as the euro stabilized.
In company news, money manager Blackrock is expected to launch an internal trading platform in 2011, which it says will be one of the world's largest and offer low trading costs.
BJ's Wholesale Club soared in pre-market trading after a report in the New York Post that Leonard Green & Partners may launch a hostile bid for the warehouse retailer if an auction doesn't take place in the the next few weeks. The Post cited an unnamed source close to the situation.
The Blackstone Group, meanwhile, has its eyes Centro Properties Group, an Australian shopping-center company, the Wall Street Journal reported, citing unnamed sources. According to the Journal, Blackstone is mainly interested in Centro's 600 U.S. properties.
European indexes were higher, with the exception of the FTSE-100, which returned from an extended weekend to trade lower. Asian indexes closed mostly in the green, but mining stocks dragged on the Australian market.
Coming Up This Week:
WEDNESDAY: 7-year Treasury note auction.
THURSDAY: Jobless claims, Chicago PMI, pending home sales, farm prices, money supply, Massey CEO Blankenship retires.
FRIDAY: No major economic data expected.
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