US STOCKS-Futures rise, China data sets positive tone

Wed Apr 10, 2013 8:10am EDT

* Investors position as earnings season starts

* Health Management shares fall after outlook

* Futures up: Dow 43 pts, S&P 4.3 pts, Nasdaq 10.25 pts

By Leah Schnurr

NEW YORK, April 10 (Reuters) - U.S. stock index futures rose on Wednesday, with Wall Street set to extend gains a day after hitting fresh record highs, buoyed by encouraging data from China that bode well for a recovery in the world's second-largest economy.

Economic data from China set a positive tone early in the day as imports of key commodities rebounded in March, signaling domestic demand was picking up and would help drive the economy.

"This is two pieces of Chinese economic data in a row that have proven positive," said Art Hogan, managing director of Lazard Capital Markets in New York. Data on Tuesday showed annual consumer inflation in China cooled last month.

"With the lack of U.S. economic data ... I think this market has got a path of least resistance to the upside in the near-term," said Hogan.

Investors were also positioning for the start of corporate earnings season. Among the 5 percent of S&P 500 companies that have reported results so far, almost three-quarters have topped expectations, according to Thomson Reuters data.

But quarterly profits are expected to grow just 1.5 percent from a year ago, down from a January estimate of 4.3 percent.

The lowered expectations could make it easier for companies to beat analysts' estimates and propel the market further. The Dow closed at a fresh record on Tuesday, while the broader S&P 500 is half a percentage point away from its all-time high.

While investors are cautious of what the corporate earnings season will bring, declines in the U.S. equity market have been taken as buying opportunities throughout this year's rally.

Family Dollar Stores reported weaker-than-expected profit on Wednesday, sending its shares down 4.6 percent to $57.06 in light premarket trading.

S&P 500 futures rose 4.3 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 43 points, and Nasdaq 100 futures added 10.25 points.

Hospital operator Health Management Associates Inc cut its outlook for 2013 earnings and revenue, citing weak patient admissions in the first quarter of the year. The stock slumped 13.03 percent to $10.95 in premarket trading.

Shares of Facebook rose 2 percent to $27.11. General Motors said on Tuesday it is running ads for a Chevrolet car on mobile versions of Facebook, rolling back its decision to stop advertising on the social network a year ago.

The White House proposed a budget that sharply trims the deficit over three years by forcing millionaires to pay more in taxes and enacting spending cuts that replace the reductions that went into place last month. President Barack Obama is due to release his full budget at 11:15 am EDT (1515 GMT).

Minutes from the Federal Reserve's most recent rate-setting meeting are due at 2:00 pm EDT. Investors will look for clues on whether Fed officials were warming to the idea of scaling back the central bank's bond purchases.

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