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Futures Rise as Banks Continue to Surge

Stock index futures indicated a higher open for Wall Street, with investors optimistic after Federal Reserve Chairman Ben Bernanke said he expected the economy to start recovering next year.

"This (economic) decline will begin to moderate and we'll begin to see a leveling off," Bernanke said during an interview on "60 Minutes" Sunday.

A higher open would continue a rally that ran through last week and was based on hope for some stability in both the financial sector and the economy. Futures indicated a bump of about 1 percent across the board for the major indexes.

Recent data points show an unexpected growth in retail spending, while officials at troubled banks Citigroupand Bank of America both insisted their institutions will weather the current storm.

Citi shares gained more than 10 percent in Monday premarket trading while BofA picked up nearly 9 percent.

At the same time, fears of a spike in oil prices abated after the Organization of Petroleum Exporting Countries said it would not cut production in an effort not to contribute to the global recession woes.

Dow component ExxonMobil shares edged higher premarket.

General Electric shares also gained more than 3 percent after UBS removed the CNBC.com parent from its short-term sell list.

Futures shed a bit of their gains after an economic report showed the Empire State Manufacturing Index found another new low in March, with a reading of minus 38.23 against expectations of minus 32.0

Asian markets were higher as banks fears begun to subside, while European markets were also higher.

HSBC is unlikely to go back to shareholders for more cash after its almost $18 billion rights issue, the South China Morning Post reported on Monday, citing the group's chief financial officer Douglas Flint. Shares rose 3 percent premarket.

British bank Barclays said it had discussed selling its ETF business iShares, sending its stock sharply higher on hopes it will be able to avoid issuing new shares to bolster its capital. Barclays US-traded shares gained 16 percent premarket.

Major European and US banks and companies benefited heavily from the taxpayer-funded bailout of American International Group, a list of its counterparties published Sunday showed.

The biggest beneficiary in the US was Goldman Sachs, while in Europe Societe Generale was the biggest recipient, followed by Deutsche Bank and Barclays. Goldman shares were 2.2 percent higher premarket.

More encouraging reports that authorities across the world were trying to contain the economic crisis came Monday, when the Nikkei business daily said the Bank of Japan is considering purchasing subordinated debt issued by banks to help bolster their capital.

But as G20 finance ministers made tentative advances during their preparatory talks at a countryside hotel south of London at the weekend, promising to raise the amount of funds available for emerging market economies that cry out for help, analysts said the group still does not have the "magic bullet" for the crisis.

Also on the economic front, industrial production data for February is to be released at 9:15 and is expected to have decreased by 1.2 percent, at a slower pace than January's 1.8 percent fall.