Focus Stays on U.S. as Markets Recover Their Poise - ABC 33/40 - Birmingham News, Weather, Sports

Focus Stays on U.S. as Markets Recover Their Poise

Posted: Updated:
In this Nov. 15, 2012, file photo, traders work on the floor at the New York Stock Exchange, in New York. (AP Photo/Seth Wenig, File) In this Nov. 15, 2012, file photo, traders work on the floor at the New York Stock Exchange, in New York. (AP Photo/Seth Wenig, File)

By PAN PYLAS
AP Business Writer

LONDON (AP) - Markets recovered their poise Tuesday despite concerns over the progress of budget talks in the U.S. and the state of the world's largest economy in the run-up to key jobs data at the end of the week.

Those concerns weighed on Wall Street on Monday and much of the Asian session earlier but European markets have proven a bit perkier. There was no real catalyst to the recovery, leading some commentators to credit the advance to an underlying sense of optimism in the markets as investors start to consider how to close out a year that's proven more profitable than many had thought.

"It is difficult to target what was responsible for this turnaround but the oft quoted 'Santa rally' is taking a fair amount of credit," said Alastair McCaig, market analyst at IG

In Europe, the FTSE 100 index of leading British shares was up 0.1 percent at 5,876, while Germany's DAX rose 0.3 percent at 7,453. The CAC-40 in France was 0.7 percent higher at 3,590.

Wall Street was poised for a steady opening, with Dow futures and the broader S&P 500 futures were up 0.1 percent.

Trading was relatively subdued across markets, with the euro up 0.2 percent at $1.3074 and the price of a barrel of benchmark New York oil a cent higher at $89.10 a barrel.

The focus in the U.S. will likely remain on the budget discussions between the White House and Congress. An agreement has to be reached by the end of this year to avoid the so-called "fiscal cliff" of automatic tax increases and spending cuts.

The Republican majority in the House of Representatives followed the White House's plan with its own on Monday. Most analysts think a deal will be cobbled together in time though there may be some setbacks along the way.

"Equity markets remain unsettled for as long as the gap between tax increases and spending cuts cannot be bridged," said Neil MacKinnon, global macro strategist at VTB Capital. "We remain hopeful that at least some sort of partial compromise can be reached before the end of this year."

The focus will likely remain centered on the U.S. this week, though Thursday's European Central Bank policy meeting will also garner some interest. Though a cut in the benchmark interest rate is not anticipated, investors will be interested to see the latest quarterly economic forecasts from the bank.

The key moment of the trading week will likely be Friday's U.S. nonfarm payrolls figures for November, though the figures could well be distorted by the impact of Superstorm Sandy which battered much of the eastern seaboard. There's already evidence that it has had an impact alongside worries over the "fiscal cliff". Monday's monthly manufacturing survey from the Institute for Supply Management weakened far more than anticipated.

Earlier in Asia, Japan's Nikkei 225 index fell 0.3 percent to close at 9,432.46 while Hong Kong's Hang Seng gained 0.2 percent to 21,799.97. South Korea's Kospi fell 0.3 percent to 1,935.18. In mainland China, the Shanghai Composite Index rose 0.8 percent to 1,975.14. The smaller Shenzhen Composite Index added 1.3 percent to 743.62.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

  • Latest StoriesMore>>

  • Repairing burst Los Angeles main could take days

    Repairing burst Los Angeles main could take days

    Friday, August 1 2014 3:39 AM EDT2014-08-01 07:39:31 GMT
    Hundreds of cars submerged below murky water. A landmark basketball court, newly refurbished, showing signs of buckling. Soaked and stained carpets. An athletic track coated in mud.More >>
    Repair crews on Thursday were shoring up a giant hole in the middle of Sunset Boulevard caused by a ruptured pipe, as officials at the water-logged University of California, Los Angeles, continued to assess damage from the...More >>
  • Neighbors who rescued plane crash victims: "It's a miracle they survived"

    Neighbors who rescued plane crash victims: "It's a miracle they survived"

    Thursday, July 31 2014 9:50 PM EDT2014-08-01 01:50:59 GMT
    A family of four traveling to Tennessee from Florida crash landed their plane in central Alabama. More >>
    A family of four traveling to Tennessee from Florida crash landed their plane in central Alabama. More >>
  • Embattled Homewood hotel forced to close, guests left looking for new accommodations

    Embattled Homewood hotel forced to close, guests left looking for new accommodations

    Thursday, July 31 2014 9:50 PM EDT2014-08-01 01:50:02 GMT
    Guests at America's Best Inn Suites packed up and left Thursday. The Homewood hotel lost its business license and an extension to keep it running was denied.More >>
    Guests at America's Best Inn Suites packed up and left Thursday. The Homewood hotel lost its business license and an extension to keep it running was denied.
    More >>
  • Small plane crash in Helena sends 4 to hospital with serious injuries

    Small plane crash in Helena sends 4 to hospital with serious injuries

    Thursday, July 31 2014 9:29 PM EDT2014-08-01 01:29:14 GMT
    Authorities are investigating a small plane crash in Helena Thursday afternoon, a fire spokesman said.More >>
    Authorities are investigating a small plane crash in Helena Thursday afternoon, a fire spokesman said.More >>
  • Lackey goes from Red Sox to Cards for Kelly, Craig

    Lackey goes from Red Sox to Cards for Kelly, Craig

    Thursday, July 31 2014 9:26 PM EDT2014-08-01 01:26:42 GMT
    The Boston Red Sox have traded right-hander John Lackey to the St. Louis Cardinals for right-hander Joe Kelly and outfielder Allen Craig before Thursday's deadline, a person with knowledge of the deal said.More >>
    The Boston Red Sox traded right-hander John Lackey to the St. Louis Cardinals for right-hander Joe Kelly and outfielder Allen Craig before Thursday's deadline.More >>
  • Lethal injections on hold in Alabama

    Lethal injections on hold in Alabama

    Thursday, July 31 2014 9:19 PM EDT2014-08-01 01:19:47 GMT
    16 Alabama death row inmates have exhausted their appeals and are waiting to be executed. But, lethal injections will not be performed in the state at least until next spring. Republican state Senator Cam Ward says that will be the earliest lawmakers will be able to pass new legislation that will allow Alabama to get the drugs used for executions.Ward says that pharmaceutical companies are refusing to sell Alabama more drugs until they can get some type of protection or immunity. It's because...More >>
    16 Alabama death row inmates have exhausted their appeals and are waiting to be executed. But, lethal injections will not be performed in the state at least until next spring. Republican state Senator Cam Ward says that will be the earliest lawmakers will be able to pass new legislation that will allow Alabama to get the drugs used for executions.Ward says that pharmaceutical companies are refusing to sell Alabama more drugs until they can get some type of protection or immunity. It's because...More >>
  • Another decent start for Woods at Firestone

    Another decent start for Woods at Firestone

    Thursday, July 31 2014 7:50 PM EDT2014-07-31 23:50:46 GMT
    Tiger Woods took another step on one of his favorite courses toward showing his game might be turning around.More >>
    Tiger Woods showed signs of a positive recovery Thursday at the Bridgestone Invitational.More >>
  • Alabama gets commitment from 4-star cornerback Rico McGraw

    Alabama gets commitment from 4-star cornerback Rico McGraw

    Thursday, July 31 2014 7:47 PM EDT2014-07-31 23:47:50 GMT
    Alabama picked off another school's cornerback recruit. Four-star cornerback Rico McGraw flipped, verbally committing to Alabama after he had been committed to Georgia since January.The 6-foot, 190-pound McGraw is the No. 142 rated recruit according to 247Sports composite. He attends Ensworth High School in Nashville.McGraw is Alabama's 21st commitment for the 2015 class, and the Tide's second verbal of the week. Safety Ronnie Harrison committed to sign with Alabama on Monday.More >>
    Alabama picked off another school's cornerback recruit. Four-star cornerback Rico McGraw flipped, verbally committing to Alabama after he had been committed to Georgia since January.The 6-foot, 190-pound McGraw is the No. 142 rated recruit according to 247Sports composite. He attends Ensworth High School in Nashville.McGraw is Alabama's 21st commitment for the 2015 class, and the Tide's second verbal of the week. Safety Ronnie Harrison committed to sign with Alabama on Monday.More >>