In the U.S.: Stock Futures Climb Before Jobless Report

8 March 2012

Markets look set for consecutive days of growth, as outlook improves on Greece, unemployment

U.S. stock futures rose, indicating that the Standard & Poor’s 500 Index will climb for a second day, as Greece moved toward finalizing its debt swap and investors awaited a jobless claims report.

JPMorgan Chase & Co. (JPM) and Citigroup Inc. (C) paced financial companies higher. AT&T Inc. gained after the company was said to be in talks to sell a majority stake in Yellow Pages.American International Group Inc. (AIG) fell after the Treasury Department said it will sell $6 billion of the company’s shares.

S&P 500 futures expiring this month jumped 0.9 percent to 1,364.8 at 7:26 a.m. in New York, while Dow Jones Industrial Average futures added 101 points, or 0.8 percent, to 12,942.

“The picture in Europe looks a lot better than three or four months ago,” said Mike Lenhoff, chief strategist at Brewin Dolphin Securities Ltd. in London. “In Greece, it looks like the creditor-participation rate is certainly within the threshold area that the government are looking for. In the U.S., the overall trend of employment has been positive.”

The benchmark S&P 500 rebounded yesterday from its biggest decline in 2012, as financial and industrial shares rallied, after a private report showed American companies added jobs and more investors said they will take part in Greece’s debt swap.

A report at 8:30 a.m. in Washington may show that jobless claims stayed at a level matching a four-year low last week, according to economists’ estimates compiled by Bloomberg. The Labor Department’s monthly jobs release tomorrow will show that the unemployment rate remained at 8.3 percent in February, according to a Bloomberg News survey of economists.

Greece’s Debt Exchange

In Greece, investors accounting for 60 percent of the bonds eligible for the nation’s debt swap have so far indicated they will take part in the biggest sovereign restructuring in history. Greece’s largest banks, most of the country’s pension funds, and more than 30 European lenders have agreed to the offer, bringing the total to about 124 billion euros ($164 billion), based on data compiled by Bloomberg from company reports and government statements.

The debt exchange aims to reduce the 206 billion euros of privately held Greek sovereign debt by 53.5 percent.

JPMorgan, the biggest U.S. bank, increased 1.4 percent to $40.50 in early New York trading, Citigroup gained 1.6 percent to $33.76 and Bank of America Corp. (BAC), the country’s second- largest lender by assets, added 1.2 percent to $8.12.

AT&T gained 0.7 percent to $31.09 in German trading after two people familiar with the matter said the company is in talks to sell a majority stake in its Yellow Pages unit to Cerberus Capital Management LP in a transaction that values the business at about $1.5 billion.

AT&T would retain a minority stake in the division, and a deal could be reached this month, said the people, who declined to be identified because the negotiations are private.

AIG slid 2 percent to $28.85 in early New York trading after the Treasury announced it will sell shares of the insurer that it rescued in 2008 after mortgage-related investments soured.


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