US Air-Delta deal could lift stocks

Stocks could gain on US Air's $8 billion deal for bankrupt Delta Air Lines, inflation and interest rate hopes.


NEW YORK (CNNMoney.com) -- A proposed major airline deal could help stocks gain altitude in the early going Wednesday.

Stock futures were slightly lower in early trading, but a comparison to fair value, which predicts the direction of stocks at the open, pointed to a slightly higher open.

US Airways (Charts) announced it has proposed an $8 billion cash and stock purchase of Delta Air Lines (Charts) when the nation's No. 2 emerges from bankruptcy court protections.

In addition to weighing the deal, investors are looking ahead to the release of minutes from the last meeting of the Federal Reserve, due at 2 p.m. Wednesday, and the Consumer Price Index, the government's broad measure of prices on the retail level, which is to be released Thursday morning.

Stocks rallied Tuesday after St. Louis Fed President William Poole, one of the voting members of the central bank's policy-setting open market committee, said that bank's current policy on rates and inflation is "about right." The comment fueled a rally that took the Dow to another record high close.

Stocks had also been lifted by the Producer Price Index, the government's measure of inflation at the wholesale level. The core PPI, which had been forecast to edge higher, instead posted its biggest drop since 1993.

The comments and price report also sparked a rally in bonds, taking the yield on the 10-year, which moves in the opposite direction, down to 4.57 percent. Treasuries were little changed in early trading Wednesday.

Oil prices were slightly higher ahead of the 10:30 a.m. ET report on U.S. fuel inventories.

In corporate news, Deutsche Boerse dropped out of the bidding for competing exchange Euronext which could open the way for NYSE Group (Charts) to buy the exchange and create the first trans-Atlantic stock market operator.

Dow component Boeing (Charts) is reportedly set to announced $10 billion in new aircraft sales, led by a sale of 15 jets to General Electric's (Charts) aircraft leasing unit, according to a report in the Wall Street Journal.

Clear Channel (Charts), the nation's largest radio station operator, could announce as early as Wednesday which company is the winning bidder for the company. Top of page

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Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.