Before the Bell: Futures Advance on Hopes of Greece's Rescue

Posted Feb 9th 2010 8:11AM by Melly Alazraki
Filed under: Before the Bell, International Markets, Coca-Cola (KO), Toyota Motor Corp. (TM), Market Matters, Electronic Arts (ERTS), Economic Data

U.S. stock futures advanced Tuesday, a day after the Dow Jones Industrial Average finished below the 10,000 mark for the first time since early November. With investors encouraged by signs the EU could bail out Greece, bargain hunters searched for deals following the selloff.

U.S. stocks dropped Monday for the third time in four sessions, with the S&P 500 falling 0.9% and the Dow industrials falling over 100 points, or 1%. Concerns about European debt weighed on Wall Street as was the outlook for the U.S. economy, especially in light of reports that Federal Reserve Chairman Ben Bernanke will begin laying the groundwork for credit tightening later in the year.

But even as markets expect the European Union to assist Greece with its debt problems, officials deny one is needed. The European Union's own government-backed lender said Tuesday that it cannot bail out Greece or any other European country that can't pay its debts, according to reports.

The euro now trading near an eight-month low against the U.S. dollar on worries that Greece might need financial rescue to cope with its soaring debt and deficit. Still, expectations of a rescue for Greece followed news that European Central Bank President Jean-Claude Trichet was leaving a meeting of central bankers in Sydney early to attend a European Union leaders' summit.

Overseas, Asian markets were mixed, while European stocks rose cautiously Tuesday on hopes that EU officials will provide Greece with some form of support.

On the economy side, the government is expected to report wholesale inventories for the month of December at 10:00 a.m. Eastern. Economists expect a 0.5% increase, according to Briefing.com, after an increase of 1.5% the prior month.

Among stocks in the news, Coca-Cola (KO) early reported better-than expected results, Toyota (TM) added about 400,000 vehicles to its ever growing recall, and Electronic Arts (ERTS) slumped some 9% are issuing a disappointing outlook.