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Aug 21, 2012, 06.41 PM IST
MARKETS-USA-STOCKS:Wall Street poised to make four-year high
NEW YORK (Reuters) - U.S. stock index futures edged higher on Tuesday, with Wall Street set to make another run at a four-year high as equity markets continue to grind steadily higher on hopes that central banks will act in the near future to stimulate their economies.
The S&P 500 has risen nearly 3 percent so far in August. Much of those gains have come on a few outsized days while other days have seen small incremental gains. Volumes have been light as investors wait for central banks' meetings next month where policymakers are expected to take action to ease Europe's debt crisis and boost the economy.
"I am looking for new highs in the major indexes," said Wayne Kaufman, chief market analyst at John Thomas Financial in New York. "Overall there is no one major negative that's out there right now that people are scared of."
The perception of declining risks from the euro crisis has been a major factor behind equity gains. Yields at a Spanish short-term debt auction dived on Tuesday, while Europe's volatility index VSTOXX hit a one-month low, signaling a steady rise in investors' appetite for risk.
The S&P 500 needs to pass this year's high of 1,422.38 set in April to make a four-year intraday high. That would take the index back to May 2008. The index closed 1,418.13 on Monday.
"With no negative headlines dampening enthusiasm the market looks ahead to another milestone," said Andre Bakhos, director of market analytics at Lek Securities in New York. "That could easily be accomplished today."
S&P 500 futures rose 2.6 points and were 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 rose 24 points, and Nasdaq 100 futures added 8 points.
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Signs that the U.S. labor market is performing better than previously thought have also helped stocks.
European stocks rose, keeping a four-week rally alive, as investors bet the European Central Bank will soon start buying Spanish and Italian bonds to help lower their borrowing costs. The FTSEurofirst 300 rose 0.2 percent.
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