(Updates with futures paring gains, signaling flat open;
updates prices)
* Takeover news spurs optimism on Wall Street
* Oil advancing ahead of weekly inventory data
* Beige Book eyed for economic conditions
By Ellis Mnyandu
NEW YORK, June 11 (Reuters) - U.S. stocks headed for a flat
to slightly higher open on Wednesday as takeover news buoyed
sentiment after Staples Inc <SPLS.O>, the No. 1 U.S. office
supply chain, won its battle to buy Dutch company Corporate
Express.
But with oil prices creeping back up, investors may be
cautious. U.S. crude <CLc1> rose above $133 before weekly
government data on U.S. energy stockpiles due at 10.30 a.m.
(1430 GMT).
Also on tap was the Federal Reserve's Beige Book for May,
which tracks economic conditions, due at 2 p.m. (1800 GMT).
"Any takeover activity these days that gives any indication
that the mergers and acquisitions activity is alive is a
positive," said Paul Mendelsohn, chief investment strategist at
Windham Financial Services in Charlotte, Vermont.
"On a morning when we have any deal, the market wants to
start higher out of excitement. The focus will also be on oil
and the Fed's Beige Book."
S&P 500 futures <SPc1> rose 2.6 points and were at
break-even with 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> gained 4 points, while Nasdaq
100 <NDc1> futures rose 1.25 points.
Staples announced it had won its battle to buy Corporate
Express <CXP.AS> after the Dutch office supply wholesaler
agreed to a sweetened bid of 1.7 billion euros ($2.65 billion).
For details, see [].
In other positive news, Goldman Sachs raised its price
targets on several railroad operators, including Union Pacific
<UNP.N>, Norfolk Southern <NSC.N>, CSX Corp <CSX.N> and
Burlington Northern Santa Fe <BNI.N>.
Enthusiasm for railroad shares has helped the
transportation sector surge to new highs in recent weeks as
investors bet that record oil prices would boost demand for
railroad freight.
U.S. crude rose nearly 2 percent to $133.81 a barrel after
BP <BP.L> said the world's proven reserves were mostly
unchanged last year, a further sign of tightening global
supply.
Shares of Alcoa Inc <AA.N> could be a drag after
theflyonthewall.com said JP Morgan downgraded the stock of the
aluminum producer. Alcoa shares dipped 2.7 percent $41.56
before the bell.
With the broad market at its most oversold condition in
nearly three weeks, investors were expected to scour for
bargains in beaten-down sectors such as technology.
U.S. stocks ended mostly lower on Tuesday as concern that
interest rates will climb hurt technology shares, but the Dow
managed to close on the positive side after an upgrade of
Coca-Cola Co shares.
(Editing by Kenneth Barry)
