FOMC minutes, data on U.S. producer prices awaited
By Simon Kennedy, MarketWatch
NEW YORK (MarketWatch) — U.S. stock futures rose on Wednesday after drug maker Genzyme Corp. agreed to a sweetened $20.1 billion offer and personal computer maker Dell Inc. beat earnings’ expectations.
Stock-index futures only lightly eased back on mild gains after data showing U.S. housing starts climbed more than expected in January. A separate report had producer prices climbing 0.8% last month.
The Genzyme (GENZ 75.38, +1.08, +1.45%) deal will see French pharmaceutical group Sanofi-Aventis SA (FR:SAN 51.38, +1.58, +3.17%) (SNY 34.73, +0.24, +0.70%) pay $20.1 billion in cash along with a series of milestone payments based on the performance of certain drugs. Read more on Sanofi's acquisition of Genzyme.
Futures on the Dow Jones Industrial Average (DJH11 12,227, +25.00, +0.21%) rose 31 points to 12,233 and S&P 500 futures (SPH11 1,330, +3.50, +0.26%) gained 3.9 points to 1,330.2.
Nasdaq 100 futures (NDH11 2,387, +5.75, +0.24%) were up 6.25 points at 2,387.75.
U.S. stocks have been on a tear lately but closed with modest losses on Tuesday. Economic reports showed retail sales climbing less than expected and the cost of imported goods rising. The Dow Jones Industrial Average (DJIA 12,227, -41.55, -0.34%) closed down 41.55 points, or around 0.3%.
The minutes from the latest meeting of the Federal Reserve’s Federal Open Market Committee will also be released, at 2 p.m. Eastern.
“The perception of a U.S. recovery is becoming more entrenched,” said Andrew Dalton, chief investment officer at Dalton Strategic Partnership.
“North American fourth-quarter earnings results, together with the associated corporate outlook for this year, have continued to impress,” Dalton said in a note to clients.
With three quarters of the S&P 500 by market capitalization having reported earnings, core profits have been 6.2% higher than analysts were forecasting at the start of earnings season, Dalton said.
Continuing that trend of stronger-than-expected earnings, shares of Dell (DELL 14.73, +0.82, +5.90%) jumped 6.6% in premarket trading.
Late Tuesday, the computer maker said net profit nearly tripled, driven by strong fourth-quarter corporate sales. Adjusted earnings of 53 cents a share were well ahead of the 36-cent consensus forecast. Read more on Dell's profit surge.
Also higher ahead of the opening bell, shares of discount retailer Family Dollar Stores Inc. (FDO 55.56, +11.60, +26.39%) surged 25% to $55.05 after the company said it’s received an unsolicited takeover bid from Trian Group worth between $55 and $60 a share in cash.
Shares of book and music retailer Borders Group Inc. (BGP 0.18, -0.05, -23.42%) fell 23% in pre-open trade after it filed for reorganization| under Chapter 11 bankruptcy code. The retailer said it will shutter close 30% of its stores.
Major companies reporting results on Wednesday include Comcast Corp. (CMCSA 24.90, +0.74, +3.06%) (CMCSK 23.53, +0.92, +4.07%) , Deere & Co. (DE 97.51, +3.89, +4.16%) and CBS Corp. (CBS 21.65, -0.10, -0.46%) (CBS.A 21.76, -0.09, -0.41%) , among others.
European stock markets were also higher. The French CAC 40 index (FR:PX1 4,146, +35.57, +0.87%) was up 0.8%, helped by strong gains for Societe Generale (FR:GLE 51.16, +2.26, +4.62%) after the lender beat earnings expectations.
Asian markets ended mostly higher, with Japan’s Nikkei 225 Average (JP:NI225 10,808, +61.62, +0.57%) closing up 0.6%.
