Futures Flat, Obama to Present Budget

Stock index futures pointed to a flat open for Wall Street on Monday as President Barack Obama prepares to present his 2012 budget plan to Congress and following two weeks of gains.

The budget aims to slash $1.1 trillion from the U.S. deficit over 10 years and includes a range of domestic spending reductions that would put the government on track to halve the federal budget deficit by the end of Obama's first term in office.

Stocks ended the week higher on Friday after Egyptian President Hosni Mubarak stepped down. While futures were flat to slighter lower ahead of the open, theS&P 500 remains within three points of doubling its ominous 666 intraday low hit on March 6, 2009.

Middle East Turmoil

Concerns over Middle East unrest have eased since Mubarak’s exit, with oil prices off highs, but the outlook for Egypt remains uncertainand more unrest could cause further volatility.

With no macroeconomic data due on Monday, investors will gear up for retail sales data on Tuesday and inflation figures on Wednesday. Creeping inflation has increasingly become a concern for investors.

In merger and acquisition news, General Electric will buy the well support division of British energy services firm John Wood Group for about $2.8 billion while private equity company Clayton Dubilier & Rice is close to buying Emergency Medical Services.

General Electric owns a stake in CNBC's parent company, NBC Universal.

And EchoStar has agreed to buy Hughes Communications for about $1.33 billion, excluding debt, a move that will boost the broadband capabilities of the communication equipment provider.

Some of the biggest financial policymakers appear before Congress this week, with the highest-profile event on Thursday when Federal Reserve Chairman Ben Bernanke testifies before the Senate Banking Committee.

The panel will also hear from the heads of the Securities and Exchange Commission and the Commodity Futures Trading Commission.

In stocks news, some key earnings will take center stage this week. Dell releases quarterly figures after the bell on Tuesday, while Deere reports before Wednesday’s opening bell.

Nokia fell after news the wireless handset maker has entered into a partnership with Microsoft. JPMorgan downgraded the company to "underweight" from "overweight."

In Europe, debt issues are once again in focus as Spain and Italy hold debt auctions.

Italy sold 5.2 billion euros in government bonds on Monday morning in an auction analysts said received solid demand.

Investors are also keen to find out more details of a European debt rescue fund next month.

European finance ministers meet in Brussels on Monday evening to discuss how to give their rescue fund more firepower and how to tackle new crises, but final decisions are unlikely before March.

The euro hit 3-week lows against the dollar in early European trade amid reports that Germany’s financial watchdog has become involved in a rescue of ailing lender WestLB.

Coming Up Next Week:

MONDAY: NY Fed President speaks; earnings after-the-bell from Marriott.
TUESDAY: Retail sales, Empire state manufacturing survey, import & export prices, Treasury international capital, business inventories, housing market index, Cleveland Fed President speaks, Dodd-Frank hearing, Geithner testifies before U.S. House, Fannie/Freddie reform hearing, credit-card default rates reported, 13-F filings due; earnings before-the-bell from Barclays; earnings after-the-bell from Dell and Tesla.
WEDNESDAY: Weekly mortgage applications, housing starts, PPI, industrial production, House hearing on FCIC report, oil inventories, FOMC minutes; earnings before-the-bell from Comcast; earnings after-the-bell from CBS, NetApp and Nvidia.
THURSDAY: Weekly jobless claims, CPI, leading indicators, Philadelphia Fed survey, Chicago Fed President speaks, money supply; earnings before-the-bell from Barrick Gold, AngloGold and Nordstrom.
FRIDAY: Earnings before-the-bell from Campbell Soup.

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