* U.S. stock index futures track European stocks higher
* Verizon/AT&T may make break-up bid for Vodafone -report
* February factory orders expected to show solid rise
* Goldman Sachs downgrades Hewlett-Packard, shares fall
* Futures up: Dow 48 pts, S&P 6.3 pts, Nasdaq 19.25 pts
By Ryan Vlastelica
NEW YORK, April 2 U.S. stock index futures
pointed to a higher open on Tuesday, suggesting a rebound from
the previous session and again putting the S&P 500 within
striking distance of its all-time intraday high.
The benchmark index last week set an all-time closing high,
but has thus far been unable to reach its intraday record of
1,576.09, an important psychological level for investors.
While moves may be limited this week ahead of the U.S.
monthly payrolls report on Friday, investors will be looking to
the latest economic data for signs of economic strength.
February factory orders are scheduled for release at 10 a.m.
(1400 GMT) and are seen rising 2.9 percent, compared with a 2
percent drop in the previous month.
The Institute for Supply Management-New York's March index
of regional business activity is due at 9:45 a.m. U.S. car
companies will report March sales on Tuesday, and a Reuters poll
forecast total vehicle sales at 15.32 million last month.
"We've had significant pockets of strength in the data, but
also some weakness. If we can see some broad-based expansion of
growth, that would be very beneficial for markets," said Oliver
Pursche, president of Gary Goldberg Financial Services in
Suffern, New York.
S&P 500 futures rose 6.3 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 added 48
points and Nasdaq 100 futures rose 19.25 points.
A weak reading on U.S. manufacturing sparked a decline in
Monday's session, though other indicators have pointed to a
strengthening U.S. economy and helped push both the Dow and S&P
to record highs last week.
Telecommunication shares will be in focus. Verizon
Communications and AT&T have been working together
on a breakup bid for British mobile operator Vodafone
, according to the Financial Times' Alphaville blog.
Verizon and AT&T, both Dow components, were not active in
premarket trading, but U.S. shares of Vodafone gained 4.7
percent to $29.67 before the bell. The stock was one of the
biggest boosts among European shares, which rose 1
European shares bounced back after a two-week slide and with
a blue chip index breaking above a resistance level, as the M&A
activity helped lift sentiment.
Healthcare stocks will also be in focus as planned cuts in
U.S. government payments for private Medicare Advantage insurers
did not materialize. Humana, which derives about
two-thirds of its revenue from Medicare Advantage business,
soared 9.6 percent to $82.20 in premarket trading.
The S&P is up 9.5 percent so far this year while the Dow is
up more than 11 percent. While investors view market momentum as
positive, many are also calling for a pullback given the size
and swiftness of recent gains.
"We take money off the table on days when we see rallies of
about 1 percent," said Pursche. "We think things are getting
Hewlett-Packard Co slumped 4.1 percent to $22.36 in
premarket trading after Goldman Sachs downgraded the Dow
component, saying it expects the company's earnings power to
come under pressure. Goldman has a $16 price target on the
stock, which implies downside of more than 30 percent from HP's
Monday closing price.
Goldman Sachs also removed Apple Inc from its
Conviction Buy list, though it affirmed its "buy" rating on the
stock. "We believe Apple may find it difficult to hit consensus
expectations in the March and June quarters," the bank wrote to
BGC Partners late Monday said it would sell its
eSpeed platform to Nasdaq OMX Group for $750 million in
cash. Shares of BGC soared 40 percent to $5.40 before the bell.