Wall St. to open higher after ECB rate cut; Twitter to debut

Thu Nov 7, 2013 9:24am EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Chuck Mikolajczak

NEW YORK (Reuters) - U.S. stocks were poised for a higher open on Thursday, after an interest rate cut by the European Central Bank reinforced expectations global central banks will continue to take actions to buoy struggling economies worldwide.

The European Central Bank cut interest rates to a new record low, responding to a slump in inflation has sparked fears the euro zone's economic recovery could stall.

"The ECB has indicated they were tied to interest rates already in prior meetings, focusing on price stability, and as price stability deteriorated that warranted an interest rate cut," said Anastasia Amoroso, Global Market Strategist at J.P. Morgan Funds in New York.

"There was a clear indicator that pushed them to make the decision, which is the deterioration in core inflation, and in a way they had no choice but to show to the market their credibility by providing support to the economy."

The FTSE Eurofirst 300 .FTEU3 climbed 1.1 percent and the Vanguard FTSE Europe ETF VGK.P rose 0.4 percent to $56.98 before the opening bell.

Investors will also brace for the market debut of Twitter Inc (TWTR.N: Quote). It priced its initial public offering above the expected range at $26 per share to raise at least $1.8 billion, a sign of strong investor demand for the most highly anticipated U.S. public float since Facebook Inc (FB.O: Quote).

"I've been concerned about revenues and the fact that one of the risks the company has pointed out that it may never make money," said Kim Forrest, senior equity research analyst, Fort Pitt Capital Group in Pittsburgh.

"This is not the kind of company, even if I hail from technology, that I am prepared to invest in or that I suggest anybody else ever invest in."   Continued...

A trader works on the floor of the New York Stock Exchange, November 4, 2013. REUTERS/Brendan McDermid