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Morning Look from KCG Securities:

U.S. stock-index futures advanced, following the Standard & Poor’s 500 Index’s gain last week.

Apple Inc. added 1.2 percent in early New York trading as the Wall Street Journal reported that the company has held talks with Comcast Corp., America’s largest cable operator, about streaming live and on-demand television. Herbalife Ltd. jumped 7 percent after it agreed to nominate three people proposed by billionaire Carl Icahn to its board.

Futures on the S&P 500 expiring in June climbed 0.3 percent to 1,861.9 at 7:45 a.m. in New York. The equity benchmark rose 1.4 percent last week. Dow Jones Industrial Average contracts gained 32 points, or 0.2 percent, to 16,253 today.

“U.S. futures are pointing slightly higher, looking to carry on last week’s positive momentum,” Richard Hunter, head of equities at Hargreaves Lansdown Plc in London, wrote in an e-mail. “Investors are for the moment not concerned by geopolitical events and are remaining more U.S. centric. Economic data to be released later this week should add further color to the strength of the still nascent U.S. recovery.”

U.S. President Barack Obama arrived in Europe as Russia, which completed its annexation of Crimea last week, positioned its armed forces on the border with eastern Ukraine. U.K. Foreign Secretary William Hague wrote in yesterday’s Sunday Telegraph that the troop buildup means the crisis may worsen,
calling the situation the most serious risk to Europe’s security this century.

A report from Markit Economics Ltd. at 9:45 a.m. will probably show U.S. manufacturing activity slowed this month. The index dropped to 56.5 from 57.1 in February, according to the median estimate of economists in a Bloomberg News survey.

A Commerce Department report tomorrow will show new house sales fell to 445,000 in February from 468,000 in January, according to economists surveyed by Bloomberg News.

European stocks retreated, after the Stoxx Europe 600 Index’s biggest weekly advance in more than
a month, as world leaders gather in The Hague to discuss tension over Ukraine and a manufacturing gauge for China and Germany slipped. U.S. index futures and Asian shares rose.

Royal KPN NV lost 2.4 percent after Citigroup Inc. downgraded the stock. Centrica Plc declined 1.2 percent after a report said U.K.’s biggest utilities may be split. CEZ AS, the biggest Czech utility, climbed 3.3 percent after the nation’s finance minister said the government is seeking a 100 percent
dividend payout.

The Stoxx 600 fell 0.6 percent to 325.83 at 10:11 a.m. in London. The benchmark index advanced 1.8 percent last week as Russian President Vladimir Putin said he won’t seek territory beyond Crimea. Standard & Poor’s 500 Index futures added 0.2 percent, while the MSCI Asia Pacific Index gained 1.1 percent.

• Support:1858, 1850, 1830
• Resistance: 1879, 1891, 1912

By annexing Crimea, Russian President Vladimir Putin is decoupling his nation from the very source of much of its wealth.
The CHART OF THE DAY shows that the 120-day correlation between the Micex Index of Russian stocks and Brent crude reached minus 0.2 this month, the most negative since 2003, compared with an average of 0.42 over the past five years. A reading of 1 would indicate the two assets are in lockstep. Minus 1 would represent complete divergence.
While Putin’s intervention in Crimea has fueled a $127 billion slide this year in the value of companies listed on the country’s stock market, oil prices have remained steady. Standard & Poor’s and Fitch Ratings cut Russia’s credit outlook last week on concern that U.S. and European Union sanctions will slow growth in the world’s largest energy producer.
“If there are sanctions against the use of Russian oil and gas, that’s going to economically hurt Russia and also prop up the prices of commodities,” Timothy Ghriskey, chief investment officer at Solaris Asset Management LLC in New York, which manages about $1.5 billion in assets, said by phone on March 21.
“We have no clue what the resolution will be. Eventually, the correlation between Russian stocks and oil will reassert itself, but we don’t know when.”
Oil prices have jumped more than fivefold since 2001, stoking a 536 percent advance in the Micex as Russia recovered from the 1998 debt default to become the world’s eighth largest economy. Revenue from crude and gas exports account for more than half of the government’s budget.
Russian stocks entered a bear market this month as America penalized officials and business leaders tied to Putin. U.S. President Barack Obama also signed an executive order authorizing, though not plementing, sanctions affecting unidentified parts of the economy.