wall street shakes off fears

Wall Street shakes off fears

Mar 11 7:52AM

Futures point higher despite gloomy outlook from Texas Instruments, WellPoint and a jump in price of oil above $109 a barrel.

Stocks looked to rebound at the start of Tuesday's session as bargain-hungry investors hunted for buying opportunities after three straight sessions of declines, even as the price of oil continued to climbed to new highs above $109 a barrel.

Less than two hours before the start of trading, Nasdaq and S&P futures were higher, with a comparison to fair value pointing to a sharply higher open for Wall Street.

"Looks like we're having a little bit of a bounce here," said Peter Cardillo, chief market economist at Avalon Partners. "This is a market that is focusing on putting in a bottom."

Stocks tumbled Monday and late last week as recession and credit fears rattled investors. Financial sector stocks, including Bear Stearns (BSC, Fortune 500) and Lehman Brothers (LEH, Fortune 500), were particularly hard hit.

Recent signals that the U.S. economy is on the brink of a recession, including last week's troubling employment report, have led to speculation that the Federal Reserve could take a more aggressive stance - including an emergency rate cut - ahead of the central bank's meeting scheduled for next week.

Wall Street could get some reassuring numbers on the U.S. trade deficit Tuesday given the recent weakness in the dollar, as the Commerce Department will release the latest reading on international trade at 8:30 a.m. ET. Economists polled by Briefing.com expect a reading of $59 billion, up from $58.8 billion in December.

"If it comes within expectations, we could see the market bounce from yesterday's lows," said Cardillo.

Oil prices continued to climb to new levels Tuesday, hitting a new trading high of $109.20 a barrel in electronic trade, helped by a weakened U.S. dollar. But prices pared their gains a bit as light, sweet crude for April was $1.12 higher to $109.02 a barrel.

The dollar fell to a new low of $1.5495 against the euro Tuesday, following a surprise climb in a reading on German investor confidence.

Companies to watch include chipmaker Texas Instruments (TXN, Fortune 500), which cut its first-quarter sales and profit outlook late Monday after a decision by one of its wireless phone customers to scale back on orders.

Citigroup (C, Fortune 500) took action to bolster six of its hedge funds after they came under pressure by tighter conditions in the municipal bond market, The New York Times reported. The company reportedly is poised to inject $1 billion into leveraged municipal bond funds with $15 billion in assets.

Health insurer WellPoint (WLP, Fortune 500) lowered its earnings outlook for 2008 late Monday, citing rising medical costs and an enrollment decline in fully insured products.

Boeing (BA, Fortune 500) said Monday it will formally protest a $35 billion contract to replace air-to-air refueling tankers awarded by the Air Force to European Aeronautic Defence and Space Co. and Northrop Grumman (NOC, Fortune 500)

On the earnings front, supermarket chain Kroger (K, Fortune 500) is due to report results before the opening bell.

Gold prices opened higher. COMEX gold for April gained $12.10 to $983.90 an ounce.

In overseas trade, most Asian markets rebounded. European shares rose in early trading.