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Market News: Before the Bell
 
Futures point higher (RTGAM)
TERRY WEBER
 
  U.S. stock futures pointed to a higher start Tuesday as investors looked to continue the recent rally even as oil prices touched a new intra-day high of $50.48 (U.S.) a barrel.

On Wall Street, Nasdaq futures were up 4.00 points to sit 4.37 points above fair value, suggesting a higher start for tech stocks.

On Monday, the Nasdaq managed its first five-day rally in more than four months.

Standard & Poor's futures rose 3.00 points to sit 3.83 points above fair value, signalling a similar start for the Dow.

In Toronto, the Standard & Poor's/TSX composite index starts the day at 8,812.91, after climbing 65.82 points on Monday. Monday's close was the index's highest in nearly six months.

In Japan, the Nikkei 225 Average edged 2.20 points higher to end Tuesday at 11,281.83. Stocks in Europe were also higher in early going.

In North America, light, sweet crude oil futures were again pushing higher in pre-market trading, touch a fresh intra-day high of $50.48, a penny above the previous record set last week. Tuesday's high was also 57 cents above Monday's closing price.

November futures contracts appeared to be reacting to a prolonged production outage in the Gulf of Mexico following hurricane activity in the region.

The new high came even as OPEC president Purnomo Yusgiantoro predicted Tuesday that oil prices will drop below $40 a barrel in the first quarter of 2005.

“There are growing concerns that the U.S. oil industry in the Gulf of Mexico suffered far more severely than had been thought and that it will take time to bring the facilities there back to the levels of production prior to the hurricane season, which is now finally coming to an end,” Dennis Gartman, author of the daily Gartman Letter newsletter, said.

“Further it is interesting that crude is firm despite the fact that the Nigeria situation seems, for the moment at least, to have been resolved.”

On the corporate front, Advanced Micro Devices Inc. stock could come under pressure after the California-based semiconductor maker said third-quarter revenue would likely be at the low end of its forecast. It didn't give a specific forecast but said weakness in sales of chips used for cell phones and other devices was to blame.

The company's shares were down about 1.5 per cent in pre-market trading.

On the economic front, Federal Reserve Chairman Alan Greenspan delivers the first of two addresses this week on Tuesday afternoon. The topic is banking and the remarks come at the American Banking Association's annual conference in New York, but — as usual — traders will be more interested in what the Fed chairman has to say about the state of the U.S. economy.

Previously, Mr. Greenspan has said the U.S. economy is now gaining traction after a weak spell early in the summer. Traders will also be on the look out for any reading on the employment market ahead of Friday's September non-farm payroll report.

Also set for release Tuesday is the Institute for Supply Management's September assessment of activity in the massive U.S. services sector. Last week, the ISM's latest survey suggested continued strength in the nation's manufacturing sector, even though growth was slightly weaker than the month before.

The Canadian dollar — which last week hit an 11-year high — was a little stronger Tuesday, trading at 78.62 cents (U.S.), up from Monday's closing price of 78.57 cents. On Monday, the loonie shed more than half a cent as its U.S. counterpart regained its footing in the markets.

 


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