U.S. stock futures were once again higher this morning, indicating investors would like to continue yesterday's rally in U.S. markets. Earlier this morning, however, futures were lower as news from Wells Fargo and Freddie Mac kept concerns over the financial and credit markets high. Also today several economic indicators will be in focus and they could change the mood in either direction.Yesterday, U.S. stocks rallied after an Abu Dhabi $7.5 billion investment from into Citigroup lifted the markets. The Dow industrials rose 215 points, or 1.69%, the Nasdaq Composite rose 39 points, or 1.57%, and the S&P 500 gained 21 points, or 1.49%.
Despite the rally in stocks, bonds didn't decline too much, as they seem to still price in a high chance of a recession.
Today, October durable-goods orders are due out at 8:30 a.m. EST. Economists expect no change from last month. At 10:00 a.m. EST, October existing-home sales will be released with another decline expected. It seems that further confirmation the housing market is in trouble is not necessary, but any surprises to the down side here could still affect markets. At 2 p.m. EST, the Fed will release the Beige Book, which gives glimpses into the state of the economy.
At 10:30 a.m. EST, weekly energy inventories data will be reported. Crude oil futures fell further today to near $94 a barrel ahead of the report as more believe OPEC will consider increasing production to ease record prices.
Meanwhile, the dollar continued to strengthen against the euro and the yen and other major currencies after stocks had a strong showing yesterday and some hawkish comments from Federal Reserve members. In addition, a decline in German consumer confidence could weaken the ECB's case for high interest.
Overseas, Asian stocks were mixed, while European shares broke a two session losing streak with banks gaining again.
No doubt, the major stories this morning come from Wells Fargo (NYSE: WFC) and Freddie Mac (NYSE: FRE). Wells Fargo "will recognize $1.4 billion in losses in the fourth quarter on home equity loans that aren't being repaid as the real estate slump deepens in California, the Midwest and other major markets." Freddie Mac is planning a "sale of $6 billion in special stock to help shore up its battered finances." Many will take a close look at that sale and how it's progressing.
Other news in focus this morning:
It seems that not only brick and mortar stores had a strong start for the holiday shopping season, online retailers did too as data from 'Cyber Monday' is coming out. In fact, Sales sets a record this Monday.
BHP Billiton (NYSE: BHP) said it would keep pressing its $150 billion bid to merge with Rio Tinto (NYSE: RTP), telling shareholders the step is compelling despite resistance from Rio.
The U.S. housing troubles effects are not contained to American companies, it seems. In fact, they continued to affect the performance of European firms, with building-products distributor Wolseley (NYSE: WOS) reporting a profit fall among others.
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