* Movement in fiscal cliff negotiations begins
* New York state manufacturing activity falls further in Dec
* Apple reverses course to trade higher in premarket
* Futures up: S&P 5.8 pts, Dow 23 pts, Nasdaq 11 pts
By Leah Schnurr
NEW YORK, Dec 17 Wall Street was set to open
higher on Monday as investors were encouraged by signs of
movement on "fiscal cliff" negotiations over the weekend.
Republican House Speaker John Boehner edged slightly closer
to President Barack Obama's key demands as they try to avert the
tax hikes and spending cuts that are set to take effect in the
Sources familiar with the talks confirmed that Boehner
proposed extending low tax rates for everyone who has earned
less than $1 million, and rates would rise for wages above that.
But Boehner's new positions were still far from those held by
"It does solidify that a deal is very close and it could be
announced by the end of this week," said Peter Cardillo, chief
market economist at Rockwell Global Capital in New York. "We
could be surprised. We could actually have a Santa gift that a
deal has been reached."
Uncertainty over when and if a federal budget deal will be
done has kept investors cautious in what is already a normally
quiet trading period heading into year-end.
Investors are worried the economy could slide back into
recession if the full brunt of the tax and spending changes is
allowed, though most expect a deal will eventually be reached.
Monday's economic data was less cheery as manufacturing
activity in the New York region declined for a fifth month in a
row in December.
S&P 500 futures rose 5.8 points and were above fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration of the
contract. Dow Jones industrial average futures gained 33
points and Nasdaq 100 futures added 11 points.
If the S&P 500 sustains its gains through the session, the
index would snap a two-day losing streak. Despite the
uncertainty of fiscal cliff talks, the S&P has performed well in
the last month, grinding higher in mostly light volume.
Clearwire Corp agreed to sell the rest of the
company to Sprint Nextel Corp for a slightly sweeter $2.2
billion offer, days after minority shareholders criticized the
previous bid as too low. Clearwire tumbled 8.6 percent to $3.08,
while Sprint was up 1.8 percent at $5.65.
Apple Inc reversed earlier losses in premarket
action and was up 0.5 percent at $512.23 even as Citigroup cut
its rating to 'neutral' from 'buy' and slashed its price target
to $575 from $675.
Apple shares have tumbled nearly 30 percent in about three
months, losing 3.8 percent on Friday alone and helping lead the
overall market lower.
The tech giant said it sold more than 2 million of its new
iPhone 5 smartphones in China during the three days after its
launch there on Friday, but the figures did not ease worries
about stiffer competition.
American International Group Inc may raise as much
as $6.5 billion from the sale of its remaining stake in AIA
Group Ltd, exiting a business the U.S. insurer started nearly
100 years ago. AIG was up 1.7 percent at $34.44.
Networking equipment company Cisco Systems Inc has
hired Barclays to sell its Linksys home router unit, a
report said on Sunday.