Stocks rev up after Ford results

U.S. stocks rebounded at Monday's open, following a big selloff that ended last week, and after Ford posted its first quarterly profit in more than a year.

The Dow Jones industrial average (INDU) rose 40 points, or 0.4%, in early trading. the S&P 500 (SPX) jumped 6 points, or 0.3%, and the Nasdaq composite (COMP) rose points, or 0.3%.

Stocks tumbled Friday on worries that the market was due for a correction, bringing Wall Street's seven-month winning streak to a halt in October. The Dow lost nearly 250 points, or 2.5%, the biggest one-day selloff on a point basis since April 20.

Dave Lutz, managing director equity trading for Stifel Nicolaus, suggested that many investors are looking for buying opportunities. Some encouraging foreign economic numbers, including a strong manufacturing reading out of China, were also providing a boost to investor confidence early Monday.

"I think that has led to some level of optimism," he said.

Earnings: Ford Motor (F, Fortune 500) delivered its first quarterly profit in more than a year Monday, helped by the government's Cash for Clunkers program.

The company said it earned nearly $1 billion, or 29 cents a share. The automaker was expected to post a loss of 12 cents a share, according to Thomson Reuters estimates.
0:00 /4:39Stimulus money behind GDP growth

Ford shares rose 11% in early trading Monday.

Economy: Investors will look to a reading on construction spending as well as a report on pending home sales at 10 a.m. ET. Economists surveyed by Briefing.com are anticipating a 0.5% decline in construction spending and 1.2% increase in home sales.

Also due out is a survey of nationwide manufacturing activity, which is expected to show modest growth, according to estimates.

Companies: Small business lender CIT (CIT, Fortune 500) filed the fifth-largest U.S. bankruptcy on Sunday as part of a reorganization plan that has the support of most of the company's debtholders.

CIT said it has already worked out a reorganization plan with bondholders that it expects to speed the Chapter 11 process and reduce CIT's debt by $10 billion.

World markets: Stocks in Asia tumbled, with Japan's Nikkei shedding more than 2%. Major European indexes were mixed in midday trading.

In currency trading, the dollar retreated against the euro and the yen, and was higher versus the pound.

Crude prices also bounced back from Friday's slide, jumping 18 cents to $77.18, after reaching a high of $78.25 earlier in the session.