Stocks: Investors welcome Europe's fiscal pact

@CNNMoneyInvest January 31, 2012: 9:22 AM ET
premarkets, CNNMoney

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NEW YORK (CNNMoney) -- U.S. stocks are poised for a higher open Tuesday, after European Union leaders agreed to strengthen a financial firewall and sign a fiscal pact.

World markets rose, and in the United States S&P 500 (SPX), Dow Jones industrial average (INDU) and Nasdaq (COMP) futures were about 0.4% higher. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.

During their meeting in Brussels,on Monday, European Union leaders agreed to implement the European Stability Mechanism, a permanent rescue fund, in July. The €500 billion ESM was originally set to enter into force next year, when a temporary bailout fund expires.

The leaders of all but two members of the 27-nation EU also agreed to sign a fiscal pact, which was designed to prevent governments from running excessive deficits and racking up unsustainable debts.

EU leaders back fiscal pact, bigger firewall

But the first summit of the year ended without new solutions for the debt crisis in Greece. Without a deal with private-sector creditors, the country jeopardizes its access to bailout funds, and might not be able to make a €14 billion debt payment that's due March 20.

"There's positive news coming out of Europe, but it's still very tenuous with Greece," said Jeffrey Phillips, chief investment officer of Rehmann Financial. "Every time we see something positive there, we seem to see it reverse in four or five days."

Stateside, investors will be mulling quarterly results from companies including Exxon Mobil (XOM, Fortune 500), UPS (UPS, Fortune 500), Pfizer (PFE, Fortune 500) and Mattel (MAT, Fortune 500).

U.S. stocks recovered most of their lost ground Monday afternoon, but struggled to pull out of the red as concerns over Greece continued to weigh on the market.

World markets: European stocks posted solid gains in mid-day trading. Britain's FTSE 100 (UKX) added 0.7%, the DAX (DAX) in Germany gained 1% and France's CAC 40 (CAC40) climbed 1.5%.

Shares of European banks traded in the United States also rose in premarket trading. ING (ING) climbed about 4%, while Deutsche Bank (DB) and UBS (UBS) both gained more than 1%.

Meanwhile, Asian markets ended modestly higher. The Shanghai Composite (SHCOMP) ticked up 0.3%, the Hang Seng (HSI) in Hong Kong added 1.1% and Japan's Nikkei (N225) rose 0.1%.

Economy: The Case-Shiller 20-city home price index showed home prices dropped 1.3% month-over-month in November.

Later in the day, the January edition of the Conference Board's Consumer Confidence Index is also set for release, as is the Congressional Budget Office's 10-year budget and economic outlook.

The Consumer Confidence Index is expected to hit 67 in January, up from 64.5 in the month prior, according to a survey of analysts by Briefing.com.

Companies: RadioShack (RSH, Fortune 500) shares plunged 29% in premarket trading, after the electronics retailer warned late Monday that its fourth quarter earnings will fall far short of expectations.

Exxon Mobil shares rose 0.3% in premarket trading, after the oil giant reported its quarterly earnings climbed to $9.4 billion on revenue of $121.6 billion.

Mattel shares rose 2.5% in premarket trading, after the toymaker beat Wall Street estimates on quarterly earnings and raised its annual dividend 35%. Worldwide sales of Barbie dolls, Hot Wheels and American Girl toys posted solid gains, although revenue overall fell short of analysts' expectations.

Mattel's top competitor, Hasbro (HAS), will release its corporate results Monday.

Pfizer was hurt in the fourth quarter by the loss of its patent for Lipitor, a drug for treating high cholesterol. But the drug maker still beat Wall Street expectations on earnings and revenue, sending its shares rising 1% in premarket trading.

UPS shares rose 0.5% in premarket trading, after the courier beat forecasts on earnings but fell short on revenue. In a statement, Kurt Kuehn, UPS's chief financial officer, said the company expects 2012 to bring "mixed economic growth around the world."

Following their quarterly reports, shares of McKesson (MCK, Fortune 500) rose 3.8%, Eli Lilly (LLY, Fortune 500) rose 3.2%, and McGraw-Hill Companies (MHP, Fortune 500) rose 2.5%. Agribusiness giant Archer-Daniels-Midland (ADM, Fortune 500) saw its shares slump 4.4%.

After the closing bell on Tuesday, online retailer Amazon (AMZN, Fortune 500) will report its results.

Currencies and commodities: The dollar fell against the euro and the British pound, but gained versus the Japanese yen.

Oil for March delivery gained $1.44 to $100.22 a barrel.

Gold futures for April delivery rose $7.60 to $1,741.90 an ounce.

Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.88% from 1.84% late Monday.  To top of page

Index Last Change % Change
Dow 17,959.44 154.64 0.87%
Nasdaq 4,781.42 16.04 0.34%
S&P 500 2,078.54 7.89 0.38%
Treasuries 2.16 -0.01 -0.64%
Data as of 7:52pm ET
Company Price Change % Change
Gilead Sciences Inc 92.90 -15.55 -14.34%
Bank of America Corp... 17.71 0.09 0.51%
Apple Inc 112.94 1.16 1.04%
General Electric Co 25.71 0.09 0.35%
Facebook Inc 81.45 1.57 1.97%
Data as of 4:00pm ET
Overnight Avg Rate Latest Change Last Week
30 yr fixed4.02%3.98%
15 yr fixed3.13%2.98%
5/1 ARM3.12%3.00%
30 yr refi4.04%4.05%
15 yr refi3.18%3.06%
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