* Producer Prices rise for first time in four months
* Housing starts drop but permits hit 4 1/2 yr high
* Fed minutes due later today
* Futures up: Dow 6 pts, S&P 0.2 pt, Nasdaq 0.75 pt
By Chuck Mikolajczak
NEW YORK, Feb 20 U.S. stocks were poised for a
flat open on Wednesday as data showed the economy continues to
show modest improvement before the minutes from the Federal Open
Market Committee's January meeting later in the session.
Groundbreaking to build new U.S. homes fell 8.5 percent in
January but new permits for construction rose to a 4 1/2-year
high while producer prices rose in January for the first time in
The data should enable the Fed to maintain its easy monetary
policy in its efforts to stimulate the economy.
Later in the session, investors will look to the minutes
from the Fed's January meeting for any indication as to how long
the current monetary policy will remain in effect.
"It's hard in any given data point to take a strong
conclusion that we are moving dramatically forward, but over
time, clearly things are getting better," said Robert Lutts,
chief investment officer at Cabot Money Management in Salem,
Lutts described an economy that was addicted to stimulus.
"The bottom line is the economy is on heroin today and we
will at one time move to a diluted form of heroin, but it's very
important for people to remember we are still on an unbelievably
aggressive, never-seen-before accommodative policy and this
economy is going to improve."
U.S. stocks moved closer to all-time highs on Tuesday, as
the ongoing flurry of merger activity to start the year has
helped protect equities from a pullback.
The S&P 500 is up 7.4 percent for the year, fueled by
legislators' ability to sidestep an automatic implementation of
spending cuts on tax hikes on Jan. 1, better-than-expected
corporate earnings and modestly improving economic data that has
been tepid enough for the Fed to maintain its stimulus policy.
S&P 500 futures added 0.2 points and were about even
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 6
points, and Nasdaq 100 futures rose 0.75 point.
U.S. oil and gas producer Devon Energy Corp reported
a fourth-quarter loss as it wrote down the value of its assets
by $896 million due to weak gas prices.
Toll Brothers Inc lost 3 percent to $35.80 in
premarket trade after the largest luxury homebuilder in the
United States, reported first-quarter results well below
SodaStream dropped 3.7 percent to $50.50 in
premarket after the seller of home carbonated drink maker
machines posted fourth-quarter earnings and provided a 2013
According to Thomson Reuters data through Tuesday morning,
of the 391 companies in the S&P 500 that have reported results,
70.1 percent have exceeded analysts' expectations, compared with
a 62 percent average since 1994 and 65 percent over the past
Fourth-quarter earnings for S&P 500 companies are estimated
to have risen 5.6 percent, according to the data, above a 1.9
percent forecast at the start of the earnings season.