Futures Regain Ground; Ford, Pharma Higher

Stock futures pointed to a modest rebound ahead of the open Monday after the Dow and the S&P 500 experienced their biggest one-day percentage drops Friday since July 2.

Ford was among the early market gainers after the automaker stunned Wall Street by reporting a quarterly profit and saying that 2011 should be "solidly profitable." Analysts had expected Ford to post a loss of 11 cents a share, but the company instead earned seven cents.

Ford shares rose 5.7 percent in premarket activity, most recently trading at $7.40 a share.

The market's other big mover was Human Genome Sciences , which soared as much as 40 percent after the company said its experimental lupus drug was successful in a second clinical trial. It would be the first new lupus treatment in 50 years.

Also in the sector, Vertex Pharma shares leaped more than 10 percent after the company said a phase II study showed that twice-daily treatments of its experimental hepatitis C drug telaprevir worked as well as three times a day.

Elsewhere, Royal Caribbean shares gained 3 percent premarket on an upgrade from Wells Fargo, and Progressive shares jumped 8.8 percent after Barron's said the insurer was set to expand earnings and revenue for the first time in years.

Friday's market drop erased October gains for the S&P 500 and the Nasdaq and left the Dow up less than half a point for the month. Investors may experience a case of pre-Fed meeting jitters this week, but also have a number of key economic stats and earnings to get through as well.

There also could be watching market reaction to the bankruptcy filing by CIT Group, which occurred over the weekend following the failure of a proposed debt exchange offer to bondholders. The filing is one of the biggest in U.S. corporate history. CIT shares tumbled 47 percent premarket.

Among the other earnings reports out this morning: Clorox; Dean Foods; Humana; Loews; and Sysco.

On the economic calendar, the Institute for Supply Management is out with its monthly manufacturing index at 10 am. Economists are looking for a reading of 53.0, above the 50 mark that represents the dividing line between contraction and expansion. The ISM index came at 52.6 last month. Note that auto sales for October will be out Tuesday.

Wal-Mart has announced a second round of toy price cuts for the holiday season, which could spark an accelerated price war between retailers.

In M&A news this morning, Denbury Resources has agreed to buy Encore Acquisition for $3.2 billion in cash and stock, creating one of North America's largest oil production and exploration companies. The deal represents a 35 percent premium for Encore shareholders.

- Written by Peter Schacknow, Senior Producer, CNBC Breaking News Desk