* Futures up: S&P 3.9 pts, Dow 31 pts, Nasdaq 10.75 pts
* China announces record spending for 2013
* Data on services sector on tap
By Leah Schnurr
NEW YORK, March 5 (Reuters) - U.S. stock index futures rose
on Tuesday as the Dow stood within reach of a record closing
high and investors were cheered by China's record spending
Outgoing Premier Wen Jiabao announced the spending aimed at
sustaining growth in the country, while China's new rulers will
focus on consumer-led growth to narrow the gap between rich and
Investors have been looking for China, the second-largest
economy in the world, to help buoy global growth at a time when
the U.S. recovery is sluggish and the euro zone is in a
Still, China gave a growth target of 7.5 percent for 2013,
below 2012's 7.8 percent.
"One of the concerns of this market has been where the
growth could come from," said Rick Meckler, president of
investment firm LibertyView Capital Management in Jersey City,
"The sequester here in the U.S. has put a bit of a damper on
spending, particularly as it relates to government spending in
the coming year and I think there's at least a feeling that
perhaps the moves in China can provide an offset to a slowdown
in the U.S."
Tensions over the U.S. fiscal crisis eased as President
Barack Obama called more opposition lawmakers to find a way to
stop the $85 billion in spending cuts known as the sequester,
while congressional Republicans announced a plan to prevent a
The Dow on Monday closed within 40 points of its all-time
closing high. Stocks have rallied since the start of the year as
investors continue to view equities as more attractively valued
than other asset classes.
Loose monetary policy around the world has also driven risk
assets. Federal Reserve vice chair Janet Yellen on Monday backed
the current aggressive monetary stimulus.
S&P 500 futures rose 3.9 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 gained 31
points, and Nasdaq 100 futures added 10.75 points.
Qualcomm rose 2.4 percent to $68.25 after the
company announced a dividend increase and stock buyback program.
Shares of J.C. Penney tumbled 3.8 percent to $16.10
in premarket trading after a source familiar with the matter
said Vornado Realty Trust is selling nearly half its
stake in the retailer.
A report on the vast U.S. services sector is expected to
show the pace of growth was relatively unchanged in February,
with economists looking for the Institute for Supply
Management's non-manufacturing PMI index to dip to 55.0 from
55.2 in January. The report is due at 10:00 am (1500 GMT).