Stock futures inch higher ahead of opening

June 7, 2010 6:23:24 AM PDT
NEW YORK (AP) - Stock futures crept higher Monday as investors enter the new week tentatively.The absence of any big moves comes after major indexes plummeted more than 3 percent Friday. Investors sold stocks following the Labor Department's monthly employment report that showed a slowdown in hiring by private employers in May. The weak report calls into question the strength and pace of a domestic economic recovery.

The Dow Jones industrial average fell 323 points Friday to close below 10,000 and at its lowest level since February.

There are few domestic economic reports due out early this week that could ease the concern brought on by the jobs report, so investors could turn their attention elsewhere for the next few days. That means the health of Europe's economy could again become the focus of traders and the Gulf of Mexico oil spill will also likely garner attention.

Hungary's government backed off statements it made last week that it was facing a similar debt crisis to Greece, but that wasn't enough to calm ongoing concerns. European markets fell modestly Monday.

The euro fell to a new four-year low early in the day, but rebounded and is now trading higher. As it recovered from early morning losses, European markets have pared some of their losses.

The euro dropped as low as $1.1878 before bouncing back to $1.1974.

Ahead of the opening bell, Dow Jones industrial average futures rose 23, or 0.2 percent, to 9,969. Standard & Poor's 500 index futures rose 3.50, or 0.3 percent, to 1,069.60, while Nasdaq 100 index futures rose 8.75, or 0.5 percent, to 1,843.00.

Bond prices dipped following big gains on Friday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.24 percent from 3.21 percent late Friday.

Treasury prices surged Friday sending interest rates sharply lower because investors sought safety of government bonds following the jobs report.

The Labor Department said Friday that private employers hired just 41,000 workers in May, down sharply from 218,000 in April and the lowest number since January. It was a reminder to investors that while the economy is incrementally improving, the pace of recovery is not necessarily swift.

Investors trying to get beyond the sting of that report will have to wait until Wednesday afternoon for another broad reading on the health of the economy. The Federal Reserve releases its beige book on Wednesday, which will provide the Fed's view of the economy on a regional basis.

The weekly unemployment report due out Thursday is likely to get increased attention because the monthly jobs data was so disappointing. Economists expect initial jobless claims inched lower last week.

Retail sales and consumer sentiment reports are due out Friday. Those two reports could be vital to investors regaining confidence because there is concern that without new jobs being created consumers will cut back on spending and their confidence will wane. Retailers' stocks were among the hardest hit after the employment report Friday.

Meanwhile, oil and gold prices both fell Monday.

Overseas, Britain's FTSE 100 dropped 0.5 percent, Germany's DAX index fell 0.2 percent, and France's CAC-40 fell 0.1 percent. Japan's Nikkei stock average fell 3.8 percent in its first day of trading after U.S. markets tumbled Friday.


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