Stock futures rise after Sharon says Arafat's death may mark a Middle East 'turning point.'
November 11, 2004: 8:58 AM EST
NEW YORK (CNN/Money) - The death of Palestinian leader Yasser Arafat was raising hopes among investors Thursday that there may be an opening for peace in the long-troubled Middle East.
Stock futures turned higher overnight Thursday soon after Israeli Prime Minister Ariel Sharon said that recent events, including Arafat's death, "present a historic turning point in the Middle East," according to Reuters. Sharon also was quoted as saying Israel would seek to "reach a political settlement with the Palestinians, without delay."
S&P and Nasdaq futures then extended their gains into the early morning hours.
Oil prices fell overnight, with U.S. crude futures down 51 cents to $48.35 a barrel in electronic trading, retreating after Wednesday's late run-up. Brent oil futures lost 37 cents to $44.38 a barrel in London.
The dollar, which hit record lows against the euro Wednesday, was little changed against the European currency and lost ground against the yen.
U.S. stocks were mixed and little changed Wednesday after the Federal Reserve, as expected, raised the closely-watched Fed funds rate by a quarter percentage point to 2.0 percent. (See chart for more details on Wednesday's markets.)
The Fed also left its post-meeting statement essentially unchanged, as about 84 percent of investors in fed funds futures contracts on the Chicago Board of Trade continued to bet on another rate hike in December, little changed from before the statement.
Japan's Nikkei index lost ground on a weak economic report there, and other Asian markets closed mix. European markets were generally higher following comments out of the Middle East.
There are no U.S. economic reports Thursday because of the Veterans Day holiday, and the U.S. Treasury bond market is closed for the same reason.
In corporate news, Target (Research), the nation's second largest general retailer, reported improved fiscal third quarter earnings, although it was not immediately clear how the result compared to forecasts. The company said it earned 37 cents a share from continuing operations, but said those results were reduced by a pre-tax adjustment for accounting for store leases. Analysts surveyed by earnings tracker First Call forecast the company earned 38 cents a share in the quarter. Shares of Target fell 12 cents to $50.76 in pre-market trading on INET.
Coffee retailer Starbucks met earnings expectations, earning 25 cents a share in its fiscal fourth quarter in an after-market report Wednesday. But shares fell after-hours amid disappointment that Starbucks didn't beat forecasts as it had in four of the five previous quarters.
It also repeated its earlier full fiscal year guidance of between $1.12 and $1.15 a share, which is below current forecasts. Shares of Starbucks (Research) lost $1.74, or about 3 percent, to $53.55 in after-hours trading.
The board of business software maker PeopleSoft (Research) again rejected a hostile bid from Oracle (Research) late Wednesday, sending its shares down 34 cents, or 1.5 percent, to $22.45 in after-hours trading. Shares of Oracle slipped 6 cents to $13.32 after-hours.
Dow component Coca-Cola (Research) cut earnings guidance for the third time in the last two months. This time the soft drink maker lowered key long-term earnings and sales targets, saying it now looked for annual earnings-per-share growth in the high single digits in percentage terms, rather than the 11 to 12 percent growth target it previously set. Shares of Coke lost 68 cents to $40.49 in pre-market trading on Inet early Thursday.
Thursday when CEO Neville Isdell meets analysts face-to-face for the first time Thursday at a meeting in New York.
Coke currently forecasts annual EPS growth of 11 percent to 12 percent over the long term, but it has missed that target recently.
Leading personal computer maker Dell (Research) is due to report quarterly results after the market close. Analysts are forecasting earnings per share to rise 27 percent to 33 cents.
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