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Futures Gain Amid Hopes for Euro Zone Fund

CNBC.com and Reuters
Tuesday, 10 Jul 2012 | 8:51 AM ET

U.S. stock index futuresclimbed Tuesday after euro zone leaders ratified the terms of a bailout agreement for Spain’s banking sector and as traders speculated that Germany's top court would approve the EU's permanent bailout fund.

Spain was given an extra year to meet a 3 percent budget deficit target. In addition, euro zone finance ministers agreed that its banking sector will be able to access up to 30 billion euros ($36.9 billion) in funding by the end of the month, while the final figure of the bailout , which could yet push the 100 billion euro limit agreed, should be known on or around July 20.

Germany's top court will consider whether Europe's new bailout scheme and budget rules are compatible with national law in a process influencing not just how to tackle the euro zone debt crisis, but how much deeper European integration can go.

A delay could fuel further turbulence in financial markets.

On the earnings front, Alcoa was slightly higher after the aluminum producer's quarterly revenue and profit edged past Wall Street expectations, even though prices for its aluminum are at nearly two-year lows. The company also expects growing demand in the aerospace and auto sectors. Meanwhile, at least two brokerages cut their price target on the Dow component.

Applied Materials tumbled after the chipmaker said it expects third-quarter earnings to be in the lower half of its previous outlook. The company also cut its fiscal 2012 sales outlook on weaker-than-expected demand.

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This comes a day after AMD cut its sales outlook, hurt by disappointing sales in China and Europe. In addition, at least eight brokerages lowered their price target on the company.

Google is close to paying $22.5 million to settle charges that it bypassed the privacy settings of customers using Apple's Safari browser, according to reports. Meanwhile, BMO raised its price target on the iPad maker to $700 from $695.

Intel will be acquiring a 15 percent stakein microchip maker ASML for $4 billion and fund the Dutch company's research into next-generation chipmaking technology.

Bankrupt aircraft maker Hawker Beechcraft, owned by GoldmanSachs and Onex, said it is in exclusive talks with a little-known Chinese aerospace firm over a $1.79 billion takeover, an offer that may flush out higher bids from other parties.

And United Technologies announced that its Sikorsky Aircraft unit had signed a five-year, $8.5 billion contract to build 653 H-60 Black Hawk and Seahawk helicopters for the U.S. Army and Navy. Meanwhile, Nomura cut its price target on the firm to $95 from $90.

Mako Surgical plunged almost 40 percent after the company posted lower-than-expected sales of its surgical robot for the second quarter in a row and cut its revenue forecast for the full year.

On the economic front, small business optimism dropped sharply in Junefor the second-straight month, according to the National Federation of Independent Business, with businesses downbeat on sales, profits and hiring.

The government is scheduled to auction $32 billion in 3-year notes with the results available shortly after 1pm ET.

—By CNBC’s JeeYeon Park (Follow JeeYeon on Twitter: @JeeYeonParkCNBC)

Coming Up This Week:

TUESDAY: 3-yr note auction, RIM annual mtg
WEDNESDAY: Weekly mortgage apps, international trade, wholesale trade, oil inventories, 10-yr note auction, FOMC minutes; Earnings from Marriott, Chevron interim results
THURSDAY: Jobless claims, import & export prices, Fed Pres Williams speaks, 30-yr bond auction, Treasury budget, Facebook hearing; Earnings from Fastenal
FRIDAY: PPI, consumer sentiment, Fed pres Lockhart speaks, Dell shareholders mtg; Earnings from JPMorgan, Wells Fargo

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