Wall Street set to soar on euro zone rescue plan

Defense News: NEW YORK (Reuters) - U.S. stock index futures pointed to a more than 4 percent gain at the open on Monday after a $1 trillion global emergency rescue package was launched, quelling contagion fears and sending European stocks surging.

The package of standby funds and loan guarantees was aimed at preventing Greece's debt crisis from spreading and would be available to euro zone governments shut out of credit markets.

Traders work on the floor of the New York Stock Exchange, May 7, 2010. REUTERS/Shannon Stapleton

Investor fears over Greece's struggles to manage its finances had weighing on global markets. The total package, reached by global leaders on Monday, is on the scale of the $700 billion Troubled Asset Relief Program launched by the United States in 2008 to stave off the credit crisis and appeared to restore investor confidence.

"The long awaited rescue package is making it comfortable for investors to move back into recently shunned equities," said Andre Bakhos, director of market analytics at Lek Securities in New York.

In Europe, the pan-European FTSEurofirst 300 (^FTEU3 - News) index of top shares advanced 6.5 percent, rebounding from its biggest weekly drop in nearly 18 months. European banks jumped while the Select Sector SPDR Financial fund (^XLF - News) gained 4.7 percent.

S&P 500 futures rose 49.8 points and were well above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures shot up 386 points, and Nasdaq 100 futures jumped 77.75 points.

The leaders of leading U.S. stock market operators were called to Washington for an emergency meeting on Monday to address whether they needed to add levers to their trading systems to halt sudden plunges in individual stocks, according to a source.

The meeting comes on the heels of last week's dramatic intraday plunge in U.S. markets that has continued to perplex investors and regulators.

In equities news, Boeing Co (NYSE:BA - News) is on track to deliver its first 787 Dreamliner, which will compete with Airbus's (Paris:EAD.PA - News) A380 jet, a Boeing official said Saturday. Boeing was up 5.7 percent at $70.50 in light premarket trade.

Stocks turned negative for the year on Friday on fears of another credit crisis stemming from Greece's souring finances and lingering questions about what triggered last week's sudden plunge.

The rescue package pledged 500 billion euros ($670 billion) in loans and loan guarantees to euro-zone countries, plus about 250 billion euros from the International Monetary Fund. The package is on the same scale as the $700 billion bailout launched by the United States to stave off the credit crisis.

At the same time the U.S. Federal Reserve reopened currency swap lines with several central banks in hopes of assuring markets of dollar liquidity, and the European Central Bank said it would buy government debt to steady investor nerves. A number of European central banks said they had already started.

(Editing by Jeffrey Benkoe)

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