U.S. stock futures rose, following a two-day slide for the Standard & Poor’s 500 Index, as new home construction increased and investors awaited the start of a Federal Reserve meeting.
Homebuilders advanced as Lennar Corp. gained 1.3%. Electronic Arts Inc. rose 1.8% after the computer-game publisher ousted its chief executive officer. Boeing Co. advanced 0.5% after Ryanair Holdings Plc agreed to buy $15.6 billion of airplanes. Lululemon Athletica Inc. tumbled 4.7% after lowering its sales forecast on a pants shortage.
Futures on the S&P 500 expiring in June rose 0.2% to 1,550 at 9:15 a.m. in New York. The equity benchmark fell 0.6% yesterday after the euro area forced Cyprus to extract a levy from bank deposits in return for a bailout. Dow Jones Industrial Average contracts added 21 points, or 0.2%, to 14,411 today.
“Housing is going to provide a positive backdrop to the macro economic environment and as such stocks,” Michael Mullaney, the chief investment officer at Fiduciary Trust in Boston, which manages about $9.5 billion of assets, said in a phone interview. “We don’t think that the market is in any serious condition for a significant sell-off. If it does pull back it will just be a buying opportunity at lower prices.”
The Federal Open Market Committee begins a two-day meeting at 9 a.m. today. The policy makers agreed in December to link record-low interest rates to thresholds for unemployment and inflation so that investors and households know what conditions will prompt the Fed to consider raising rates.
Builders broke ground on 917,000 homes at an annual rate, up 0.8% from a revised 910,000 pace in January that was higher than initially estimated, the Commerce Department reported today in Washington. Building permits, a proxy for future construction, advanced 4.6% to 946,000, the strongest since June 2008.
U.S. stocks fell yesterday as the Cypriot bank levy sparked concern that the euro area’s debt crisis will reignite.
Cypriot lawmakers meet at 6 p.m. in Nicosia today to debate how to spread a proposed charge on bank deposits among account holders. The levy, announced on March 16, sparked concern among investors about setting a precedent by breaking the taboo against raiding bank accounts. A European Union official said today that Cyprus is an “entirely unique” situation.
“We are talking about a one-off levy,” Simon O’Connor, spokesman for EU Economic and Monetary Affairs Commissioner Olli Rehn, told reporters in Brussels.