(Updates with Sprint, updates prices)
By Kristina Cooke
NEW YORK, May 12 (Reuters) -U.S. stocks were heading for a
higher open on Monday as the dollar rose toward a two-month
peak, helping push the price of oil back from record highs.
The positive tone also buoyed global equities, with markets
in Asia and Europe higher. World stocks were also supported by
stronger-than-expected first-quarter results from HSBC <HSBA.L>
that eased concerns about the banking sector. HSBC, Europe's
largest bank, said growth in Asia and elsewhere helped counter
a hit from its exposure to U.S. home loans.
The price of crude <CLc1> fell $2 to $123.96 a barrel.
Oil's record-setting run has been fueling concerns about
inflation and high gasoline prices that could cut into
consumers' disposable income.
It was higher energy prices, along with a drop in demand
caused by the weak economy, that prompted U.S. package delivery
company FedEx Corp <FDX.N>, an economic bellwether, to slash
its earnings forecast late on Friday. Shares fell 2.8 percent
before the bell.
"The real catalyst here is the strength of the U.S. dollar,
as it is helping take the pressure off from the higher
commodities prices. That all helps to set a better tone for
equities," said Tim Smalls, head of U.S. stock trading at
brokerage firm Execution LLC in Greenwich, Connecticut.
"Over the weekend, we had FedEx cutting its forecast, which
again highlights the impact of high oil prices."
S&P 500 futures <SPc1> rose 1.2 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 18 points,
and Nasdaq 100 <NDc1> futures rose 1.25 points.
The dollar rose a full percent against the yen and
approached a two-month high versus a basket of currencies,
boosted by a slight rise in risk demand and growing speculation
that U.S. interest rate cuts may be ending.
Apart from FedEx, a couple of negative earnings reports
kept gains in check.
Shares of Sprint Nextel Corp <S.N> dropped more than 4
percent to $8.98 after the No. 3 U.S. mobile phone company
reported a wider quarterly loss amid steep customer defections.
It forecast only marginal improvements in the current quarter.
The world's largest bond insurer, MBIA <MBI.N>, said on
Monday unrealized losses on insured derivatives skyrocketed in
the first quarter, pushing it into a sharp quarterly loss.
Shares fell more than 4 percent before the bell.
As earnings season tapers off, according to Thomson
Reuters data, 447 of the companies on the S&P 500 had reported
by last Friday. Of these, 62 percent beat analyst expectations,
10 percent were in line and 28 percent missed forecasts.
(Editing by Kenneth Barry)
