US pre-open: futures point to higher open amid ECB speculation

LONDON (ShareCast) – Dow Futures pointed towards a higher opening on Monday, amid positive news from Europe, where the European Central Bank’s (ECB) bond-buying plans look set to go ahead. The Dow Jones Industrial Average is expected to open approximately 27 points higher than Friday’s close of 17,737.37, while the S&P 500 and the Nasdaq are expected to begin the week three and eight points higher respectively.

The Stoxx Europe 600 index gained 1% after CNBC cited sources who suggested the ECB was planning a quantitative-easing program that could be based on contributions made by central banks into the Europe’s central bank.

In corporate news, Alcoa (NYSE: AA – news) will unofficially kick-off US fourth quarter earnings season on Monday ahead of a host of banks, including Bank of America (Swiss: BAC.SW – news) , JP Morgan Chase, Goldman Sachs (NYSE: GS-PB – news) , Wells Fargo and Citigroup (NYSE: C – news) reporting later during the week.

“The worry for fourth quarter earnings is that US multinationals start to really feel the bite in their foreign earnings from the stronger US dollar,” said Jasper Lawler, market analyst at CMC Markets. The US dollar index has been rallying since the summer to recent 12-year highs, which is likely to hurt US exporters and help importers.

Foundation Medicine (NasdaqGS: FMI – news) soared almost 160% ahead of the bell after Roche Holding (LSE: 0QOK.L – news) announced it would pay $ 1.03bn for up to a 56.3% stake in the maker of molecular-diagnostics tests, with the $ 50-a-share deal representing a 109% premium over Foundation’s closing price of $ 23.93 on Friday.

Tekmira Pharmaceuticals (NasdaqCM: TKMR – news) jumped 50% in premarket trading after announcing late on Sunday that it will merge with OnCore Biopharma to develop a cure for hepatitis B, while MWI Veterinary Supply (NasdaqGS: MWIV – news) rose over 8% after AmerisourceBergen confirmed it would takeover the firm in a $ 2.5bn deal.

Jewellery retailer Tiffany dropped over 8% after reporting a 1% drop in holiday-period sales.

Energy stocks were felt the pinch as oil prices fell for the seventh consecutive week, after Goldman Sachs slashed its forecasts for 2014 and 2015 on both Brent and West Texas Intermediate crude. Schlumberger , the world’s largest oilfield-services provider had its rating cut to ‘hold’ and dropped almost 2%.

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