Stock index futures at 6.30am ET indicate that the Dow Jones Industrial Average (DJINDICES: ^DJI) may open up by one point this morning, while the S&P 500 (SNPINDEX: ^GSPC) may open 1.9 points higher.
In Europe, markets edged higher this morning as investors digested Fed Chairman Bernanke’s dovish comments that the future of the Fed’s asset purchase programme is not fixed and will be adapted to suit underlying economic requirements. Pro-QE investors were also given a boost by weaker than expected US housing start figures yesterday, which suggest that the US recovery remains fragile. Elsewhere, Spanish banks reported a rise in bad debts to 11.2% in May, up from 10.9% in April. At 6.30am ET, the FTSE 100 was up by 0.3%.
Fed Chairman Bernanke will remain in the spotlight today when he testifies before the Senate Banking Committee. His testimony is scheduled to being at 10am ET and will no doubt be closely monitored by markets. At 8.30am, the latest weekly jobless claims report is expected to show that new claims fell slightly to 341,000 last week, from 360,000 during the previous week.
On the corporate front, Morgan Stanley is expected to report earnings of $0.44 per share on revenues of $7.89 billion before the opening bell this morning. Other companies due to report before markets open include Nokia, AutoNation, Verizon, BlackRock, Philip Morris International, Union Pacific Corp and Huntington Bancshares. Companies due to report after the close tonight include Advanced Micro Devices and Microsoft.
Other stocks that may be actively traded when markets open this morning include tech giants eBay, Intel Corp and SanDisk, which all reported after the close last night. eBay reported a 15% rise in revenues and a 12% rise in earnings compared to the same quarter the previous year, but its third-quarter forecasts fell short of analysts’ estimates, sending the firm’s shares down by 6.1% in pre-market trading this morning. Intel was down 3.2% in pre-market trading after the PC chipmaker issued disappointing third-quarter guidance and reported a fourth consecutive quarter of declining revenues. Memory-maker SanDisk was 5.1% higher in pre-market trading after the firm reported quarterly earnings of $1.21 per share, beating analysts’ consensus forecasts of $0.93 per share.
Finally, let’s not forget the Dow’s daily movements can add up to some serious long-term gains. Indeed, Warren Buffett recently wrote: “The Dow advanced from 66 to 11,497 in the 20th Century, a staggering 17,320% increase that materialized despite four costly wars, a Great Depression and many recessions.“
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> Roland does not own shares in any of the companies mentioned in this article.
