NEW YORK (AFX) - US stock futures are pointing to a higher open on a fresh raft of deals led by LM Ericsson's 2.1 bln usd acquisition of Redback Networks, but cautious guidance from Palm and the Pepsi Bottling Group are likely to give pause for thought.
According to the spread-betting firm IG Index, the Dow Jones Industrial Average is seen opening 7 points higher at 12,478. Separately, Nasdaq 100 futures were up 6.50 points at 1,809.75 while S&P 500 futures rose 2.10 points to 1,438.30.
Yesterday, stocks ended mixed as a disappointing earnings report from Oracle Corp weighed on the Nasdaq Composite Index, but oil-inspired gains for Dow component Exxon Mobil helped lift the blue-chip index to a record close.
In a quiet session for economic data, investors are likely to focus on a fresh round of merger-and-acquisition activity and company-specific news.
US-listed shares of Arcelor Mittal are set to move higher after the steel giant said it would acquire Mexico's Sicartsa, the first acquisition since the merger of the two companies earlier this year.
Also, shares in Redback Networks Inc rallied 3.05 usd or 14.4 pct to 21.21 usd in pre-market dealings after the maker of broadband network routers said it has agreed to be acquired by Swedish mobile phone equipment maker LM Ericsson for 2.1 bln usd in cash.
Ericsson shares were up 40 cents, or 1 pct at 40.97 usd ahead of the bell.
The Ericsson-Redback tie-up prompted CIBC World Markets to downgrade Juniper Networks, a Redback competitor in the field of routers, to 'sector performer' from 'sector outperformer.'
The broker says the merger represents formidable competition for Juniper Networks, especially in edge routers, which are used to connect computers to the Internet.
The tie-up also narrows the field of potential candidates that might be interested in acquiring the company. Juniper shares were off 2.8 pct at 18.69 usd in pre-market dealings.
Harrah's Entertainment is on track for early gains after the world's largest casino company said late yesterday that its board has accepted a 27.8 bln usd buyout offer from private equity groups, Apollo Management Group and Texas Pacific Group.
The company is recommending shareholder approval although it has reserved the right to pursue even higher bids for about a month. The offer includes the assumption of 10.7 bln usd in debt.
Yesterday, Harrah's stock ended up 14 cents at 82.32 usd.
Shares in Pepsi Bottling are likely to come under pressure after the world's largest manufacturer, seller and distributor of Pepsi beverages offered a 2007 earnings outlook that was below Wall Street expectations.
Palm shares were off 2.3 pct at 13.38 usd in pre-market trading after the maker of the Treo Smart phone offered fiscal third-quarter guidance below analyst expectations due to increased costs in marketing, litigation, and research and development.
Its disappointing outlook comes as the company posted a sharp drop in its fiscal second-quarter profits and revenues, though the results beat Wall Street analysts' lowered projections.
Outside of equities, oil prices extended prior-session gains to approach 64 usd a barrel ahead of US oil inventories that are expected to show a further drawdown in crude stocks and other petroleum products.
New York light-sweet crude for February delivery was last up 27 cents at 63.70 usd a barrel in electronic trading.
In the currency markets, the euro edged higher against the US dollar after European Central Bank chief Jean-Claude Trichet warned of inflationary pressures ahead, strengthening expectations of further ECB rate hikes in the new year.
The dollar managed a modest gain against the Japanese yen, and was little changed against the British pound.
At last check, the euro was up 0.1 pct at 1.3216 usd while sterling dipped fractionally against the dollar to stand at 1.9704 usd. Against the yen, the greenback was up 0.1 pct at 118.11 usd.
Gold futures rose as rising oil prices and yesterday's sharper-than-expected rise in US producer prices stoked inflation concerns. Gold is viewed as a inflation hedge.
The benchmark February contract was last up 1.4 usd at 626.80 usd after rising more than 7 usd in the prior session. Mark.Cotton@thomson.com mc1/jsa COPYRIGHT Copyright AFX News Limited 2006. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News. AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
According to the spread-betting firm IG Index, the Dow Jones Industrial Average is seen opening 7 points higher at 12,478. Separately, Nasdaq 100 futures were up 6.50 points at 1,809.75 while S&P 500 futures rose 2.10 points to 1,438.30.
Yesterday, stocks ended mixed as a disappointing earnings report from Oracle Corp weighed on the Nasdaq Composite Index, but oil-inspired gains for Dow component Exxon Mobil helped lift the blue-chip index to a record close.
In a quiet session for economic data, investors are likely to focus on a fresh round of merger-and-acquisition activity and company-specific news.
US-listed shares of Arcelor Mittal are set to move higher after the steel giant said it would acquire Mexico's Sicartsa, the first acquisition since the merger of the two companies earlier this year.
Also, shares in Redback Networks Inc rallied 3.05 usd or 14.4 pct to 21.21 usd in pre-market dealings after the maker of broadband network routers said it has agreed to be acquired by Swedish mobile phone equipment maker LM Ericsson for 2.1 bln usd in cash.
Ericsson shares were up 40 cents, or 1 pct at 40.97 usd ahead of the bell.
The Ericsson-Redback tie-up prompted CIBC World Markets to downgrade Juniper Networks, a Redback competitor in the field of routers, to 'sector performer' from 'sector outperformer.'
The broker says the merger represents formidable competition for Juniper Networks, especially in edge routers, which are used to connect computers to the Internet.
The tie-up also narrows the field of potential candidates that might be interested in acquiring the company. Juniper shares were off 2.8 pct at 18.69 usd in pre-market dealings.
Harrah's Entertainment is on track for early gains after the world's largest casino company said late yesterday that its board has accepted a 27.8 bln usd buyout offer from private equity groups, Apollo Management Group and Texas Pacific Group.
The company is recommending shareholder approval although it has reserved the right to pursue even higher bids for about a month. The offer includes the assumption of 10.7 bln usd in debt.
Yesterday, Harrah's stock ended up 14 cents at 82.32 usd.
Shares in Pepsi Bottling are likely to come under pressure after the world's largest manufacturer, seller and distributor of Pepsi beverages offered a 2007 earnings outlook that was below Wall Street expectations.
Palm shares were off 2.3 pct at 13.38 usd in pre-market trading after the maker of the Treo Smart phone offered fiscal third-quarter guidance below analyst expectations due to increased costs in marketing, litigation, and research and development.
Its disappointing outlook comes as the company posted a sharp drop in its fiscal second-quarter profits and revenues, though the results beat Wall Street analysts' lowered projections.
Outside of equities, oil prices extended prior-session gains to approach 64 usd a barrel ahead of US oil inventories that are expected to show a further drawdown in crude stocks and other petroleum products.
New York light-sweet crude for February delivery was last up 27 cents at 63.70 usd a barrel in electronic trading.
In the currency markets, the euro edged higher against the US dollar after European Central Bank chief Jean-Claude Trichet warned of inflationary pressures ahead, strengthening expectations of further ECB rate hikes in the new year.
The dollar managed a modest gain against the Japanese yen, and was little changed against the British pound.
At last check, the euro was up 0.1 pct at 1.3216 usd while sterling dipped fractionally against the dollar to stand at 1.9704 usd. Against the yen, the greenback was up 0.1 pct at 118.11 usd.
Gold futures rose as rising oil prices and yesterday's sharper-than-expected rise in US producer prices stoked inflation concerns. Gold is viewed as a inflation hedge.
The benchmark February contract was last up 1.4 usd at 626.80 usd after rising more than 7 usd in the prior session. Mark.Cotton@thomson.com mc1/jsa COPYRIGHT Copyright AFX News Limited 2006. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News. AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
© 2006 AFX News
