U.S. Stock-Index Futures Maintain Gains After ADP Jobs Report c.2011 Bloomberg News
Aug. 31 (Bloomberg) -- U.S. stock futures advanced, indicating the Dow Jones Industrial Average may erase its 2011 loss, after a report showed that American companies added 91,000 workers to payrolls in August.
Ford Motor Co. and Caterpillar Inc. added at least 1.5 percent, pacing gains in companies most-tied to economic growth. Freeport-McMoRan Copper & Gold Inc. jumped 1.4 percent as copper climbed on speculation the economy is strong enough to boost raw materials demand. Lions Gate Entertainment Corp. sank 5.2 percent as billionaire Carl Icahn agreed to sell his shares for $7 each to end a battle for control over the company.
Standard & Poor’s 500 Index futures expiring in September rose 1.1 percent to 1,217.80 at 8:50 a.m. in New York. The benchmark gauge added 4.6 percent over the last three days. Dow futures advanced 105 points, or 0.9 percent, to 11,597. The index was down 0.2 percent this year through yesterday.
“The economy is not falling off a cliff, and at the same time, policy makers are aware that growth is slow and they are prepared to do something to accelerate it,” Peter Jankovskis, who helps manage about $2.6 billion at Oakbrook Investments in Lisle, Illinois, said in a telephone interview. “Much of the selling that we’ve experienced was overdone and left the market poised for a rally when sentiment began to change.”
The S&P 500 has fallen 6.1 percent from the end of July through yesterday and was headed for its fourth straight monthly decline, the longest streak since March 2008. U.S. stocks rose yesterday after the Federal Reserve said some policy makers wanted to take more action to stimulate the economy during their meeting this month.
ADP Jobs Report
Stock futures maintained gains after the ADP jobs report. The median forecast of economists surveyed by Bloomberg News called for an advance of 100,000. Over the previous six reports, ADP’s initial figure was closest to the Labor Department’s first estimate of private payrolls in February, when it understated the gain in jobs by 5,000. The estimate was least accurate in June, when it overestimated the increase in employment by 100,000.
U.S. factory orders probably rose 2 percent in July after a 0.8 percent decline the prior month, according to a Bloomberg survey of analysts before today’s Commerce Department report.
Some companies whose earnings are most-dependent on economic growth rallied. Ford gained 1.7 percent to $11.06, while Caterpillar added 1.5 percent to $91.20. Freeport-McMoRan, the world’s largest publicly traded copper producer, gained 1.4 percent to $47.26.
Lions Gate slumped 5.2 percent to $7.13. The accord ends a standoff between the company and Icahn. The investor dropped a $7.50-a-share buyout offer in December, after Lions Gate marshaled enough investors to block his bid for five board seats. Board member Mark Rachesky, an ex-Icahn protege, agreed to buy some of the stock.
--Editors: Joanna Ossinger, Will Hadfield
To contact the reporter on this story: Rita Nazareth in New York at rnazarethbloomberg.net
To contact the editor responsible for this story: Nick Baker at nbaker7bloomberg.net