Futures point to stronger open following three-day weekend, but gains are tepid with little news to trade on. Economic data was a key last week with the employment report coming in slightly worse than expected for August, though showing improvement. However, the economic calendar this week is very light, leaving traders with little news to base trades on. We have gotten some merger news to start the week and this usually provides a bullish sentiment. Asian markets saw solid gains Tuesday with the Hang Sang index rising more than two percent. Stocks in Europe are also seeing gains with gains in mining stocks leading the way.

Last week ended on a positive note and the bulls are looking to extend these gains Tuesday. Despite the fact the employment report for August was a bit worse than expected, the major market indices finished with gains Friday. Nonfarm payrolls fell by 216,000 with the unemployment rate rising to 9.7 percent. After mostly losses to start September, the bulls took the data as a positive. However, the data did suggest that the consumer sector will remain sluggish.

Economic data this week is very light reports on jobless claims and the Fed's Beige Book likely to draw most the attention. It will be interesting to see how traders react this week which is considered the first week of trading following the summer. Volumes should start to pick up with traders back from summer vacations, though there will be a lack of market moving news. However, traders have had a large merger deal to digest with Kraft (KFT) offering $16.7 billion for Cadbury (CBY).

Kraft's offer was rejected by CBY with the company stating that it undervalues the company. Shares of CBY are sharply higher this morning, actually trading well above the offer price from Kraft. This is because there are rumors that Hershey (HSY) may also be interested in merging with Cadbury to prevent Kraft from acquiring the company. Initially, the KFT bid valued CBY at $48.79 a share, though this changes as the value of Kraft shares move. KFT shares are down more than 5 percent this morning, though CBY shares are trading near $53, a rise of more than 40 percent.

Shares of General Electric (GE) are higher this morning, gaining more than four percent to a price near $15.50. The company is benefiting from an upgrade at JPMorgan Chase. JPM lifted its rating on GE to "Overweight" from "Neutral" while raising its price target to $17 from $12. GE shares have come well off their 52-week low at $5.73, but are still trading at half their 52-week high of $29.28.

Jody Osborne
Senior Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site