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U.S. Stock Futures Advance as German Business Confidence Rises

Feb. 22 (Bloomberg) -- U.S. stock futures rose, indicating the Standard & Poor’s 500 Index will rebound from yesterday’s drop, as German business confidence jumped to a 10-month high and investors awaited the outcome of elections in Italy.

Hewlett Packard Co. advanced 5.5 percent in early New York trading after it forecast profit that exceeded analysts’ estimates. American International Group Inc. climbed 4.1 percent after fourth-quarter results beat forecasts. Marvell Technology Group Ltd. added 4.5 percent as earnings beat estimates.

S&P 500 futures expiring next month rose 0.5 percent to 1,508.8 at 7:29 a.m. in New York. The gauge has gained 5.4 percent this year as U.S. lawmakers agreed on a compromise budget and companies reported better-than-estimated earnings. The index fell 0.6 percent yesterday as concern grew that the U.S. Federal Reserve may slow the pace of stimulus. Dow Jones Industrial Average futures added 57 points, or 0.4 percent, to 13,929 today.

“Markets are rebounding after yesterday’s selloff, with the Ifo index jumping to a 10-month high,” Andreas Lipkow, a senior market strategist at Kliegel & Hafner AG in Berlin, wrote in an e-mail. “The Italian elections on Sunday are very important and will give markets new indications for next week.”

In Germany, the Ifo institute’s business climate index, based on a survey of 7,000 executives, climbed to 107.4 in February from a revised 104.3 in January. The median of 38 forecasts in a Bloomberg News survey had called for an increase to 104.9. The latest reading was the highest since April.

Italian Elections

In Italy, voters head for general elections on Sunday amid concern the emergence of a populist government will derail the nation’s austerity program. Caretaker Prime Minister Mario Monti has failed to make headway in opinion polls, even as former premier Silvio Berlusconi and ex-comic Beppe Grillo gained popularity. Pier Luigi Bersani, the union-backed Democratic Party candidate, leads the table. Bersani and Monti have said they will form a coalition if necessary.

About 72 percent of the companies in the S&P 500 that have released quarterly results since Jan. 8 have exceeded profit estimates, and 65 percent beat sales estimates, data compiled by Bloomberg show.

Hewlett-Packard gained 94 cents to $18.04 in early trading. The largest personal-computer maker forecast fiscal second- quarter profit that exceeded analysts’ estimates, helped by cost-cutting measures and a smaller-than-projected drop in service sales.

HP Profit

Profit, excluding some items, will be 80 cents to 82 cents a share for the current quarter, which ends in April, the Palo Alto, California-based company said. That beat the 77-cent average estimate of analysts, according to data compiled by Bloomberg.

AIG advanced $1.52 to $38.80 in early New York trading. The insurer that repaid a U.S. bailout gained as fourth-quarter results beat analysts’ estimates after investments drove a surprise operating profit.

Operating profit was 20 cents a share, beating the average forecast for a loss of 8 cents in a Bloomberg survey of 17 analysts. The net loss was $3.96 billion, driven by claims from Hurricane Sandy and costs tied to a deal to sell the plane- leasing unit, New York-based AIG said yesterday in a statement.

Marvell Technology gained 43 cents to $9.90 in New York. The maker of chips for computers and mobile phones reported fourth-quarter earnings-per-share of 19 cents, beating analysts’ estimates of 13 cents.

First Solar

First Solar Inc., the world’s largest maker of thin-film solar panels, dropped 3.5 percent to $33.21 in early trading. The stock was downgraded to underperform from sector perform at Pacific Crest Securities.

Nordson Corp. slid 6.7 percent to $65.25 in New York trading. The Ohio-based maker of machines that apply adhesives to consumer and industrial products said it expects second- quarter earnings-per-share of between 78 cents and 87 cents, compared with estimates of 93 cents.

Texas Instruments Inc. rose 1.4 percent to $32.94 in German trading. The largest maker of analog chips, increased its quarterly dividend by 33 percent and said it added $5 billion to its stock repurchase program.

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