Futures Add to Gains Despite Home Price News
Stock index futures added to strong gains after a disappointing reading on home prices that came in largely as expected, as investors appeared to focus on optimism the European Union would be able to craft a new bailout agreement for Greece.
Prices for U.S. single-family homes declined to a new low for the year. The S&P/Case Shiller composite index of 20 metropolitan areas fell 0.2 percent in March from the month before, which was in line with expectations.
The 20-city composite index at 138.16 is now below the April 2009 low of 139.26 reached in April 2009.
Germany has switched course, and is now willing to allow Greece to restructure its debt, the Wall Street Journal reported over the weekend.
Investors pushed the euro to a three-week high against the dollar. Oil prices also roseon the news.
German unemployment fell less than expected in May, figures released on Tuesday morning showed, but analysts said that although the pace of expansion of the euro zone's biggest economy was slowing a bit, the numbers were not worrisome given the strength seen in the first quarter.
On the economic front, the Chicago Institute of Supply Management will release its index of manufacturing activity at 9:45 a.m. Economists surveyed by Reuters expect the index slipped to 62.6 in May from 67.6 in April.
And at 10 a.m. the Conference Board's May reading on consumer confidence was expected to come in at 66.5 in May, up slightly from 65.4 in April.
Intel will be among stocks in focus Tuesday after the group unveiled a new category of laptops as it struggles to compete in the exploding market for mobile gadgets.
Stocks in Japan were unmoved by Moody's threat of a downgrade. The rating agency warned both growth and government action may fall short of what is necessay to bring Japan's debt under control.
Meanwhile, Asian stocksgained on a more upbeat outlook from manufacturers in Japan.
On Tap This Week:
TUESDAY: S&P Case-Shiller Home Price Index, Chicago PMI, consumer confidence, farm prices.
WEDNESDAY: Mortgage applications, Challenger job-cut report, ADP employment report, ISM manufacturing index, construction spending, auto sales; D9: All Things Digital Conference.
THURSDAY: Chain store sales, jobless claims, factory orders, natural gas inventories, oil inventories, money supply.
FRIDAY: Non-farm payroll report, ISM non-manufacturing index; Wal-Mart shareholder meeting.
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