Stimulus Hopes Continue to Lift Dow

LONDON -- The Dow Jones Industrial Average (INDEX: ^DJI  ) is expected to follow the lead set by its European and Asian counterparts and rise slightly when markets open today, according to futures markets. Hopes are pinned on hints of further central bank stimulus efforts, with Federal Reserve Chairman Ben Bernanke due to speak to Congress today.

Also of interest to U.S. traders will be the latest weekly jobless claims figures, which are due at 8:30 a.m. EDT and are expected to be down a fraction from last week. The latest household debt and consumer credit figures are due out later in the day and could provide further indications of the state of the real domestic economy. Weekly EIA gas storage figures are also due and are expected to show a rise, which could weaken natural-gas prices slightly.

In Europe, markets continued yesterday's upward march this morning, albeit at a slower pace than yesterday. The Bank of England held its monthly rate-setting meeting and confirmed that there would be no change to interest rates or additional quantitative easing for another month. Bank bailout hopes helped Spain to successfully negotiate its latest bond auction, selling just over its 2 billion euro target of short- and long-dated bonds. Yields rose substantially but remained below peak levels seen in recent days in the bond markets. The yield on 10-year bonds averaged 6.044% (last time it was 5.743%), but shorter-yielding bonds saw bigger increases, with four-year bonds yielding 5.353% and two-year bonds yielding 4.335%, up respectively from 4.319% and 3.463% at the last auction.

At 7 a.m. EDT the FTSE 100 (INDEX: ^FTSE  ) was up by 0.5%, with the German DAX up 0.2% and the French CAC 40 and Spanish IBEX 35 both up by more than 1%. In London, shares of catalytic-converter manufacturer Johnson Matthey (LSE: JMAT.L  ) rose by more than 4% following a strong set of results and the announcement of a 100 pence special dividend for shareholders. Other strong risers included Burberry and Lloyds Banking Group.

Shares likely to be active in U.S. trading today include Lee Enterprises (NYSE: LEE  ) , which rose 16% late yesterday when it was disclosed that Warren Buffett's Berkshire Hathaway had taken a 3.2% stake in the company. Another company that benefited from a substantial Buffett investment recently was a leading British blue-chip brand that also has a significant presence in the U.S. The purchase doubled Buffett's stake in this famous name to 5% -- and you can find all the details of the billionaire investor's big U.K. deal in this special free report, which includes the name of the company and the price he paid.

Companies due to release earnings today include Rite Aid, while disappointing results from The Men's Warehouse (NYSE: MW  ) last night could result in falls in trading today.

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Roland Head owns no shares of the companies mentioned. The Motley Fool owns shares of Berkshire Hathaway. Motley Fool newsletter services have recommended buying shares of Berkshire Hathaway. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.


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