Stock index futures opened slightly higher Sunday evening, adding to the gains in Friday´s session when utility and consumer discretionary names led the way higher.
Tonight, Dow futures were up 22 points, or about 0.13% in New York, and S&P 500 E-mini futures edged up 0.15%. Nasdaq 100 E-mini futures rose 0.16%. The U.S. Dollar Index (.DXY) ticked lower by 0.11%.
Over the weekend, 12 banks and two industry groups reached a preliminary agreement to pay $1.87 billion to settle allegations that they colluded to influence the market for credit derivatives, the Wall Street Journal reported.
Deutsche Bank (DB) is reportedly considering "sweeping changes" that could include closing operations in some countries, the Journal said.
Vista Equity Partners is nearing a deal to buy risk management software company Solera Holdings (SLH) for $6.5 billion including debt, a source told Bloomberg.
And China's fixed-asset investment rose at the slowest pace in 15 years and industrial production fell short of analyst estimates, prompting more questions over the effectiveness of the government's efforts to stimulate growth, Bloomberg reported.
Looking ahead, the Federal Reserve meeting on Sept. 16-17 is in full focus, as investors anxiously await details on a potential interest-rate hike. This upcoming week will be the most important week of the year, TheStreet's Jim Cramer wrote on Real Money Sunday morning.
"Unfortunately, the same ideologues and short-sellers who demand a rate hike have grown so loud that I believe the Fed might just take the cue from the "hey-what's-a-quarter-point-versus-needed-discipline" crowd rather than from a thoughtful Christine Lagarde from the IMF, who really gets the worldwide frailty, certainly better than say an Atlanta or a St. Louis Fed representative, although goodness gracious, they just talk and create downside to stocks rather than actually being able to assert policy," Cramer wrote.
To hike or not to hike? That is the question, with only one thing for sure: stocks will react.
"(I)t's the whole ball of wax this week where the hard efforts of individual companies and the multiples their stocks deserve could get denigrated by a fearful Fed, fearful of the upside that its move could engender, and oblivious to the downside it will most likely cause," Cramer concluded.
Wall Street seems split on whether the Fed will move or not.
A Reuters poll of economists gave the probability of a September move a 50-50 chance, down from a 60% median probability predicted in a survey taken last month.
Separately, here's what else we're watching this week.
On Monday, the Bank of Japan holds a two-day monetary policy meeting and judging from recent weakness in the region, we're not expecting anything but a bleaker outlook. Brazil's central bank also releases results of a weekly economic survey with more than 100 financial institutions, which includes forecasts for GDP, interest rates and inflation rates. After the S&P downgrade last week expectations are lower.
Tuesday's retail sales data for August should show how the economy is doing after sales rebounded 0.6% last month. Retail sales are expected to have increased 0.3% in August, according to Reuters. The Commerce Department also issues the industrial output for August and business inventories data for July.
Amazon (AMZN) founder Jeff Bezos is expected to unveil plans for a launch site and manufacturing complex for his Blue Origin rocket company at Cape Canaveral Air Force Station in Florida (Amazon is part of the Growth Seeker portfolio).
On Wednesday, we're watching the Consumer Price Index. Consumer prices are expected have remain unchanged in August after rising slightly in July, according to Reuters. Also, the MBA mortgage index and NAHB Housing Market Index are scheduled to be released.
A few notable companies report earnings in the latter half of the week. Software company Oracle (ORCL) reports on Wednesday. It's all about the cloud for Oracle and that's the model that needs a strong showing.
Adobe Systems (ADBE) reports third-quarter results on Thursday. Investors will be watching the progress of its web-based subscriptions for its Creative Cloud software bundle.
Drugstore chain operator Rite Aid (RAD) also reports on Thursday. Expectations are muted after the company lowered its full-year profit outlook in June due to interest costs and taxes related to the acquisition of pharmacy benefits manager EnvisionRx.
The end of the week will be dominated by the Fed's meeting and reactions, but look to the Barclays Financial Services Conference from Wednesday through Friday for more updates from the financials. Companies slated to speak include UBS (UBS), Nasdaq, CME (CME), Bank of America (BAC), Wells Fargo (WFC), Citigroup (C), JPMorgan Chase (JPM), Morgan Stanley (MS), and Allstate (ALL), among others. (Bank of America, Wells Fargo, and Morgan Stanley are all part of the Action Alerts Plus portfolio).
Separately, the Barron's cover story outlined why Alibaba (BABA) could fall 50% further. The stock is down almost 40% year to date and trading around $64. Alibaba's shares could fall much further as China's economy struggles, competition in e-commerce increases and the company's culture and governance draw scrutiny, Barron's said.
Barron's also featured Action Alerts Plus holding Apple (AAPL), saying that the company's new iPhone plan could lift shares 50%.
For even more information on data and earnings in the week ahead, read this article by fellow Real Money contributors Lenore Hawkins and Chris Versace and reference The Street's weekly earnings calendar.