Indications: U.S. futures point to second day of gains

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By Steve Goldstein, MarketWatch

LONDON (MarketWatch) -- U.S. stock futures pointed to a second day of gains Tuesday as merger activity continued, while figures are due that may show a disappointing month of car sales.

S&P 500 futures rose 5.1 points to 1,119.70 and Nasdaq 100 futures rose 8.75 points to 1,851.50. Futures on the Dow Jones Industrial Average climbed 44 points.

MarketEdge: Emerging-market 'pause that refreshes'

Market Edge: Flagging stock markets in emerging Asia and Latin America represent the "pause that refreshes," CLSA equity strategist Chris Wood tells Laura Mandaro on the sidelines of the brokerage's San Francisco conference. He recommends overweighting EM equities by five times relative to benchmark indices.

Merger news and encouraging economic data drove U.S. stocks higher on Monday, with the Dow Jones Industrial Average rising 0.8% to come near to its 2009 close. The S&P 500 rose 1% and the Nasdaq Composite climbed 1.6%.

The auto sector will be in the spotlight Tuesday as auto sales for February will be reported while General Motors joined rivals by announcing the recall of 1.3 million compact cars over power-steering trouble.

Economists at Barclays Capital expect the worst month since September 2008 due to the recall trouble at Toyota Motor /quotes/comstock/13*!tm/quotes/nls/tm (TM 73.64, -1.19, -1.59%) as well as bad weather.

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There's little else on the U.S. economics calendar as attention begins to focus on the payrolls report on Friday.

Overseas, Australia hiked its interest rate to 4%, while the Bank of Canada is expected to keep rates unchanged at 0.25%.

Terra Industries /quotes/comstock/13*!tra/quotes/nls/tra (TRA 41.20, +0.03, +0.07%) jumped nearly 13% to $46.35 a share as CF Industries /quotes/comstock/13*!cf/quotes/nls/cf (CF 107.54, +1.30, +1.22%) made a $47.70 a share bid. That bid trumps an agreed bid from Yara International, although the bid from the Norway firm is entirely in cash and the CF offer consists of $37.15 a share in cash and 0.0953 CF shares.

Qualcomm /quotes/comstock/15*!qcom/quotes/nls/qcom (QCOM 35.56, -1.12, -3.06%) rose 2.7% after increasing its stock buyback authority and increasing its dividend by 12%.

A Morgan Stanley technology conference featuring presentations from Microsoft /quotes/comstock/15*!msft/quotes/nls/msft (MSFT 29.02, +0.35, +1.22%) , International Business Machines /quotes/comstock/13*!ibm/quotes/nls/ibm (IBM 128.57, +1.41, +1.11%) and AT&T /quotes/comstock/13*!t/quotes/nls/t (T 25.00, +0.19, +0.77%) also may garner attention.

Asian markets were generally higher, as the Nikkei 225 climbed 0.5% in Tokyo, while stocks in Europe rose as gains for Allied Irish Banks /quotes/comstock/13*!aib/quotes/nls/aib (AIB 2.71, -0.12, -4.24%) after its 2009 results were countered by further losses for Prudential PLC /quotes/comstock/13*!puk/quotes/nls/puk (PUK 16.13, -2.37, -12.81%) on its planned acquisition of AIG's Asian operations.

Both the euro and the British pound were weaker Tuesday, though sterling was well above the worst levels of Monday when a combination of factors, including polls on an upcoming election and the Prudential deal, combined to hit the U.K. currency.

Copper futures were weaker by 0.3% as supply fears after the China earthquake abated.

Steve Goldstein is MarketWatch's London bureau chief.