U.S. Stock Futures Climb; S&P 500 May Rise

U.S. stock-index futures gained, indicating the Standard & Poor’s 500 Index will climb after three weeks of losses dragged the gauge to the cheapest level in more than two years.

Bank of America Corp. (BAC) rose 1.3 percent in pre-market trading as Barron’s said the North Carolina-based lender may rise 35 percent or more. Morgan Stanley and Citigroup Inc. (C) gained more than 1 percent in German trading.

Futures on the S&P 500 expiring in September advanced 0.2 percent to 1,179.5 at 6:17 a.m. in New York. Dow Jones Industrial Average futures expiring next month climbed 18 points, or 0.2 percent, to 11,268.

“We had quite a turbulent couple of weeks,” Veronika Pechlaner, who helps manage about $1.8 billion at Jersey, Channel Islands-based Ashburton Ltd., said in a telephone interview. “The market sold off and bounced back quite healthily towards the end of the week. The issue is, how will we progress from here?”

The S&P 500 has dropped 14 percent from its April 29 high as Europe’s sovereign debt crisis deepened and investors speculated the economy may contract. The index is down 6.3 percent for the year, bringing its valuation to 11.9 times estimated earnings, the cheapest since March 2009, according to weekly data compiled by Bloomberg.

Unprecedented Swings
The S&P 500 rose or fell more than 4 percent on all-but-one day last week. The swings in U.S. equities were unprecedented in the history of the American stock market, according to data compiled by Birinyi Associates Inc., Bloomberg and Howard Silverblatt, senior index analyst at S&P.

Japan’s economy contracted less than economists estimated in the second quarter as reconstruction work counters the effects of the record March 11 earthquake and a strengthening yen. Gross domestic product shrank at an annualized 1.3 percent rate in the three months ended June 30, the Cabinet office said today in Tokyo. The median forecast of 25 economists surveyed by Bloomberg News was for a 2.5 percent drop.

Data at 8:30 a.m. today may show manufacturing in the New York region stagnated in August, according to a Bloomberg survey of economists.

Bank of America, which plunged 12 percent last week, advanced 1.3 percent to $7.28 in early New York trading. The shares may be poised to rise on growth at the bank’s businesses other than its residential-mortgage division, Barron’s said.

Morgan Stanley (MS), the sixth-largest U.S. bank by assets, advanced 2.1 percent to $17.25 in German trading. Citigroup, the third-biggest U.S. lender, climbed 1 percent to $30.15.