Gottfried -- is Fitzy out on AMAT?? See below:
U.S. stocks set to rise on election optimism
Tue Nov 7, 2006 9:06 AM ET
(Updates prices)
By Ellis Mnyandu
NEW YORK, Nov 7 (Reuters) - U.S. stock futures signaled a higher open on Wall Street on Tuesday as investors bet that congressional elections would result in a business-friendly climate in Washington.
Opinion polls show Democrats could recapture control of the House of Representatives from Republicans for the first time since 1994, with Senate control hinging on several races that are too close to call. For details, see [ID:nN06288135].
If the election results in political gridlock, as some on Wall Street anticipate, analysts say that could be a near-term positive for stocks as there would likely be fewer government policy initiatives.
"The election is, in all likelihood, going to leave us with a split Congress. The Republicans will control the Senate, and the Democrats will control the House," said Tim Smalls, head of U.S. stock trading at brokerage firm Execution LLC in Greenwich, Connecticut.
"In other words, Congress will be stagnated and you'll have a very predictable business environment in Washington, with no far-reaching initiatives for a while. That's not a bad thing for the market at all."
Since 1934, the Dow Jones industrial average <.DJI> has gained about 2.9 percent on average during the eight trading days surrounding the election, according to the Stock Trader's Almanac.
S&P 500 futures <SPc1> were up 3.4 points, above fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.
Dow Jones industrial average futures <DJc1> rose 30 points and Nasdaq 100 <NDc1> futures gained 4.75 points.
Polls will begin closing at 6 p.m. (2300 GMT), but it could be hours before results are known in many crucial races.
Shares of Applied Materials Inc. <AMAT.O> rose 2.4 percent to $17.70 in electronic trade after Bank of America raised its price target on the supplier of microchip-making equipment. [ID:nWNA4776]
Shares of Wild Oats Markets <OATS.O> rose 3.4 percent to $15.14 in trading before the bell after the organic grocer posted quarterly results that beat estimates.
But Toll Brothers Inc. <TOL.N> forecast a 10 percent drop in quarterly home building revenue, which is below Wall Street estimates, sending its stock off more than 2 percent to $27.26 in electronic trading.
U.S. crude oil for December <CLc1> edged higher to $60.04 a barrel after Saudi Arabia held out the prospect of deeper output cuts.
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