U.S. stock futures up, dollar stabilizes on U.S. deal hopes

Mon Oct 14, 2013 7:24pm EDT
 
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By Dominic Lau

TOKYO (Reuters) - U.S. stock index futures ticked higher on Tuesday on expectations of an imminent deal that will reopen the U.S. government and avert a possible debt default, though the political squabbling in Washington kept markets on edge ahead of the Thursday deadline.

Asian stocks were expected to open higher, with Japan's Nikkei index futures up 0.8 percent, after U.S. Standard & Poor's 500 .SPX index reversed early losses to close up 0.4 percent, spurred by hopes of a U.S. budget deal. .N

Many markets in the region, including Singapore, Indonesia and India, were closed for holidays.

U.S. Senate Majority Leader Harry Reid said he and his Republican counterpart, Mitch McConnell, have made strong progress toward reaching a deal to end a partial government shutdown and lift the debt ceiling, averting a possible default, an outcome that is unthinkable for the global economy.

U.S. S&P 500 E-mini futures added 0.1 percent in early Asian trade on Tuesday, though U.S. Treasury futures slipped 5-1/2 ticks.

The dollar held steady at 98.67 yen, recovering from a low of 98.05 hit in the previous session. The greenback also stabilized at $1.35555 to the euro after slipping 0.1 percent on Monday.

"Risk sentiment remains resilient despite the lack of a clear breakthrough in the U.S. debt ceiling and government shutdown negotiations," analysts at BNP Paribas wrote in a note.

"The Japanese yen's initial rally has now fully reversed although in the absence of an agreement the near-term risks are for a stronger yen," they added.   Continued...

 
Traders work on the floor of the New York Stock Exchange August 28, 2013. REUTERS/Brendan McDermid