US stock futures gained Monday morning following a strong Friday. Futures for the Dow, S&P 500 and Nasdaq all rose 3%.
Monday, October 6, 2014
The optimism is the result of positive employment data from the Labor Department that came out Friday. While a gain in futures can be a good sign, it is not a guarantee that the market will necessarily follow suit.
“The overall momentum for stocks is really follow-through from the jobs report,” Phil Flynn, senior market analyst at Price Futures Group in Chicago, told the Wall Street Journal. “The US is still the best house in a bad neighborhood. The jobs number would definitely suggest that our economy is humming while the others are struggling. It’s leading toward more money coming in here.”
Hewlett-Packard to split
Office equipment supplier Hewlett-Packard confirmed today that it intends to divide into two separate enterprises, MarketWatch reported. Going forward, Hewlett-Packard’s personal computers and printers businesses will be separate from its corporate hardware and services operations. The company’s shares will be distributed tax-free among its investors through the end of 2015.
Hewlett-Packard is following the precedent set by corporations like eBay, who believe that different sectors are more effectively maintained under distinct companies. Hewlett-Packard is attempting to rebound from recent disappointing sales figures and views its corporate hardware and services as a more worthwhile focus than its PC and printers sector.
“This would be a brilliant move at just the right moment in the turnaround. It would liberate significant trapped value,” Ralph Whitworth, former Hewlett-Packard chairman, told MarketWatch.
Eyes on the Fed
The US Federal Reserve is preparing to terminate its bond-purchasing program by the end of October, Bloomberg reported. Many investors remain anxious that the Fed will hike interest rates earlier than expected as the result of renewed economic strength. More jobs data coming this morning in addition to minutes from the Federal Open Market Committee’s September 17-18 meeting might augment or diminish those fears.
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