Stock futures rise slightly; euro falls to 4-year low on ongoing economic worries

Stock futures rise slightly ahead of open

NEW YORK — Stock futures rose slightly Monday as investors received more optimistic signs of domestic growth, but still remain cautious about the health of Europe’s economy.

Another round of acquisitions lifted futures.

Evidence that the U.S. economy continues to improve have been overshadowed in recent weeks by concerns about Europe’s economy.

The euro, used by 16 countries in Europe, fell to a four-year low, though major European stock indexes rose. Investors are grappling with whether severe budget cuts in countries like Greece, Spain and Portugal will hinder a long-term economic recovery in Europe.

The austerity measures are being implemented as part of a nearly $1 trillion bailout program the European Union and International Monetary Fund agreed to last week. The rescue package provides European countries facing mounting debt problems access to cheap loans.

The euro fell to as low as $1.2237 early Monday, before rebounding slightly to $1.2339.

The plunging euro has been driving trading around the globe in recent days. The weakness in the euro has helped boost the value of safe-haven investments like the dollar, Treasurys and gold. It has also driven oil sharply lower.

Oil prices briefly fell below $70 a barrel for the first time since February. Oil is priced in dollars so a stronger dollar deters investment in oil.

Ahead of the opening bell, Dow Jones industrial average futures rose 13, or 0.1 percent, to 10,622. Standard & Poor’s 500 index futures rose 2.70, or 0.2 percent, to 1,138.20, while Nasdaq 100 index futures rose 4.25, or 0.2 percent, to 1,914.00.

Acquisition activity provided hope that the economy is strengthening. Universal Health Services Inc. agreed to buy Psychiatric Solutions Inc. for about $2 billion in cash. Japan’s second largest drug maker, Astellas Pharma Inc. agreed to purchase U.S. cancer drug company OSI Pharmaceuticals Inc. for $4 billion in cash.

Traders see dealmaking as a sign of economic recovery because it means businesses are more comfortable spending reserves to expand their operations.

Lowe’s Cos. reported a 2.7 percent rise in first-quarter net income and raised its guidance for the year, though the outlool fell shy of analyst expectations and shares fell in pre-market trading.

The home-improvement retailer’s results were the first in a line of retailers that are reporting quarterly profits this week. Home Depot Inc., Wal-Mart Stores Inc. and Target Corp. also all release results in the coming days.

Strong profits from retailers could provide a spark for investors to turn their attention back to the U.S. economy. Consumer spending accounts for the majority of economic activity in the U.S., so any growth would be a welcome sign that consumers are more confident about a domestic recovery.

Plenty of economic indicators will also be released throughout the week, including data on manufacturing, housing and inflation.

Investors brushed aside reports Friday that showed April retail sales and industrial production and March business inventories all improved.

Stocks remained extremely volatile last week as investors first cheered the European bailout program before becoming skittish about how it would affect the continent’s economy. The Dow tumbled 163 points Friday as the euro plummeted and declining oil prices hurt energy companies.

Bond prices were narrowly mixed Monday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, was unchanged at 3.46 percent compared with late Friday.

Gold rose $1.80 to $1,229.60 an ounce.

Oil for June delivery rose 7 cents to $71.68 a barrel. It fell as low as $69.82 earlier in the day.

Overseas, Britain’s FTSE 100 rose 1.2 percent, Germany’s DAX index gained 1.4 percent, and France’s CAC-40 rose 0.7 percent. Japan’s Nikkei stock average fell 2.2 percent.