European optimism to boost stocks

September 27, 2011: 7:52 AM ET

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NEW YORK (CNNMoney) -- U.S. stocks were poised to rally at Tuesday's open, as investors grew more optimistic about Europe's debt crisis being resolved.

Dow Jones industrial average (INDU), S&P 500 (SPX) and Nasdaq (COMP) futures were up 1.4% ahead of the opening bell. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

On Monday, stocks surged in the last hour of trading, as investors focused on a report that a new plan to ease Europe's debt crisis was afoot.

The plan -- reported by CNBC -- would allow troubled banks to swap bad debt for bonds backed by the European Investment Bank.

But doubts remain that the action, should it occur, would bring the crisis to a complete resolution given the continent's extremely heavy debt burden.

Europe's debt crisis: 5 things you need to know

Still, even the hint of a resolution was enough to boost world markets, and U.S. financial stocks for a second day. Shares of JPMorgan Chase (JPM, Fortune 500), Bank of America (BAC, Fortune 500), Wells Fargo (WFC, Fortune 500), and Goldman Sachs (GS, Fortune 500) were all higher ahead of the opening bell.

Gold and silver prices also rebounded, bolstering shares ofIshares Silver Trust (SLV) and Spdr Gold Trust (GLD), as well as gold and silver miners, including Silver Wheaton (SLW), BHP Billiton (BHP) and Freeport-McMoran (FCX, Fortune 500).

Gold prices jumped 4.8% to $1,683 an ounce, while silver rallied nearly 11% to $33.20 an ounce.

Economy: The Case-Shiller 20-city home price index, due before the market open, is expected to have dropped 4.5% in July -- the same reading recorded in June.

After the bell, the Conference Board will release its July consumer confidence index, which is forecast to increase to 46.6 in September from 44.5 in August.

Companies: Shares of Walgreen (WAG, Fortune 500) rallied in early trading after the drugstore chain reported better-than-expected profit and sales.

World markets: European stocks rose in morning trading. Britain's FTSE 100 (UKX) jumped 2.18%, the DAX (DAX) in Germany surged 3.16% and France's CAC 40 (CAC40) rallied 3.27%.

Asian markets ended higher. The Shanghai Composite (SHCOMP) added 0.9%, the Hang Seng (HSI) in Hong Kong gained 4.15%, and Japan's Nikkei (N225) ended the day up 2.82%,

Currencies and commodities: The dollar gained strength against the euro and British pound, but lost ground against the Japanese yen.

Oil for November delivery gained $2.35 to $82.59 a barrel.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.90% from 1.81% late Monday.  To top of page

Index Last Change % Change
Dow 16,565.55 165.88 1.01%
Nasdaq 4,392.83 76.76 1.78%
S&P 500 1,933.40 29.39 1.54%
Treasuries 2.20 0.02 0.96%
Data as of 12:29pm ET
Company Price Change % Change
Apple Inc 102.02 2.26 2.27%
Bank of America Corp... 16.50 0.24 1.47%
The Coca-Cola Co 40.75 -2.54 -5.86%
Regions Financial Co... 9.30 0.14 1.53%
Micron Technology In... 30.70 1.01 3.40%
Data as of 12:14pm ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed3.93%4.15%
15 yr fixed3.03%3.12%
5/1 ARM3.27%3.19%
30 yr refi4.01%4.20%
15 yr refi3.09%3.17%
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