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Stock Futures Point Higher, P&G Pops


NEW YORK ( TheStreet) -- Stock futures were rising Friday after major U.S. indices touched multi-year highs during the prior session and as Procter & Gamble (PG) shares popped after an upbeat earnings forecast.

Business confidence in Germany improved for a third month in January, according to the Ifo think tank's business climate index, which jumped to 104.2 from 102.4 in December.

Market sentiment also got a boost as the European Central Bank said Friday that 278 banks in the eurozone indicated that they will repay, early, €137.2 billion in three-year loans, issued a little over a year ago.

The amount was larger than expected and pointed to easing financial conditions in the region, and as Marty Mitchell, a head trader at Stifel Nicolaus said, suggested "more stability in Europe and the potential for an improved risk appetite in markets."

The consensus expectation was for the return of #8364;100 billion of the first round of the central bank's cheap loans, or LTROs (long-term refinancing operations), according to a Reuters survey. The news helped fuel a rally in European bank stocks and a fall in German government bond prices.

Futures for the Dow Jones Industrial Average were rising 41 points, or 59.67 points above fair value, at 13,822. Futures for the S&P 500 were up 4.75 points, or 6.93 points above fair value, at 1496. Futures for the Nasdaq were up 11.75 points, or 13.07 points above fair value, at 2730.

Procter & Gamble shares were gaining close to 2% in premarket trading after the company on Friday said it increased its core earnings per share guidance for the year to $3.97 to $4.07 amid "strong productivity improvement and resulting cost savings." The company also increased its outlook for share repurchases to $5 billion to $6 billion.

P&G recorded fiscal second-quarter earnings of $1.22 a share on revenue of $22.2 billion, topping the average analyst estimate of $1.11 a share on revenue of $21.91 billion.

On Thursday, the S&P 500 managed to breach the psychologically significant 1500 mark a number of times during the day. Doreen Mogavero, founder of Mogavero Lee & Co., said that "1500 was the target and traders wanted to see if we could get there this year and we'd gotten there earlier in the year. It's crossed it several times today I think but I don't think you can question the momentum of this market. Apple earnings were not what they were expected to be; that stock took a hard hit yesterday but the market doesn't seem to be too worried about it."

Mogavero said that there have been two camps, both very polarized, on theories of where the market is headed from current levels. Some traders have been feeling that the market is poised to really take off for a "huge new secular bull market" and others feel that a pullback is due.