US stock futures rise on encouraging China growth
An encouraging report on China's growth sent stock futures higher Wednesday after three days of losses.
The Chinese economy grew at a slower but still healthy rate of 9.5 percent last quarter, data showed Wednesday. China is attempting to rein in its speeding expansion and ease inflation, but a sudden drop-off in growth could hurt the U.S. economy by cutting into demand for U.S. exports. China is the world's second-largest economy.
Dow Jones industrial average futures rose 34 points, or 0.3 percent, to 12,447 in premarket trading. Standard & Poor's index futures rose 5, or 0.4 percent, to 1,315. Nasdaq 100 futures rose 12, or 0.5 percent, to 2,356.
Federal Reserve Chairman Ben Bernanke is scheduled to testify before Congress at 10 a.m. Eastern (1400 GMT). Analysts expect Bernanke to lean on lawmakers raise the U.S. borrowing limit before Aug. 2. If Democrats and Republicans can't make a deal by that deadline, the U.S. could fail to pay its debt for the first time in history. More likely than an immediate default, however, is a temporary halt to benefits like Social Security pension or military pay.
Congress and the White House will face more pressure to agree on a long-term plan to cut spending when the government reports on the federal budget deficit at 2 p.m. Eastern (1800 GMT). Analysts expect the deficit to be above $1 trillion for the third year in a row.
Kinetic Concepts Inc. rose 5 percent in premarket trading after it announced that a private equity company would buy the maker of wound care products for $4.98 billion.
Video game publisher Electronic Arts Inc. fell 3.6 percent before the market opened after it said it will buy PopCap Games, which makes cell phone games, for about $750 million but offered a disappointing second-quarter earnings forecast.
After the market closes, fast-food giant YUM Brands Inc. and hotel chain Marriot International Inc. are expected to report earnings.
On Tuesday, markets fell for a third straight day after a downgrade of Ireland's debt added to investor worries about the European budget crisis.