* Investors await final results of stress tests this week
* Sprint up after better-than-expected results
* Swine flu outbreak fears ease
* Futures up: S&P 3.10 pts, Dow 30 pts, Nasdaq 11.75 pts
* For up-to-the-minute market news click []
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By Leah Schnurr
NEW YORK, May 4 (Reuters) - Wall Street was set for a
modestly higher open on Monday as investors were hopeful banks
will be able to raise any capital they may need as a result of
findings in the government stress tests, but jitters over the
health of the sector persisted.
Shares of Sprint Nextel <S.N> were up 7.1 percent at $5.00
in premarket trading after the company reported results that
beat expectations. Investors have been encouraged by
better-than-expected results this earnings season, adding on to
hopes the recession is showing signs of abating. For details,
see [].
Citigroup Inc <C.N> is looking to raise any additional
capital it might need from private investors rather that giving
more control to the government, according to a Bloomberg report
citing people briefed on the matter. [].
The Financial Times, citing people close to the situation,
reported that Bank of America Corp <BAC.N> is working on plans
to raise more than $10 billion in fresh capital, even as it and
Citigroup launch last-ditch attempts to convince the U.S.
government they do not need to bolster their balance sheets.
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"The market already knows that Citi and Bank of America are
on the list that's going to need more capital," said Peter
Cardillo, chief market economist at Avalon Partners in New
York.
"The market seems to be thinking banks might just be able
to raise capital on their own and if that's the case, then
(that means) less government interference and that's basically
what the market would like to see."
Shares of Citigroup were flat after initially pointing
higher ahead of the opening bell, while Bank of America was off
1.5 percent to $8.57. Bank stocks are likely to remain volatile
as uncertainty over the health of the sector nags.
S&P 500 futures <SPc1> rose 3.10 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 <DJc1> climbed
30 points, and Nasdaq 100 <NDc1> futures added 11.75 points.
The government has assessed 19 major U.S. banks to ensure
the institutions have sufficient capital to withstand the
recession. The results, which are expected to be announced on
Thursday, are expected to show banks must raise possibly $150
billion or more in fresh capital and the stocks of the neediest
banks are likely to take a hit.
Fears over the swine flu outbreak eased over the weekend as
the Mexican health ministry announced its flu epidemic had
passed the worst and experts said the virus might be no more
severe than normal flu, although it could still have an impact
on world health. For details, see [].
On the data front, investors were awaiting pending home
sales for March for insight on the health of the housing
market.
In the auto sector, Italy's Fiat SpA <FIA.MI> said it could
seek a merger of its auto group with General Motors Corp's
<GM.N> Europe unit, then spin off the combined company and list
it. Shares of GM rose 4.4 percent to $1.89. [].
Stocks rose on Friday as surging oil prices pushed energy
shares higher and fresh economic data suggested key parts of
the economy could be stabilizing. Since rallying from March's
bear market low, the S&P 500 is up nearly 30 percent.
(Editing by Theodore d'Afflisio)
