Stocks are under pressure ahead of the opening as the influence of jittery oil markets adds to the week's mounting worries about the state of U.S. housing and its potential impact on the economy. Stock futures look sharply lower, and the dollar dipped after reports of weaker than expected durable goods orders.
Investors, though, may still be holding out hope that something in Fed Chairman Ben Bernanke's testimony before the Joint Economic Committee this morning could bring a "Bernanke bounce" to stocks.
Bernanke is widely expected to stick to his script and offer little new today, though housing will likely be a topic. "He's going to establish the wiggle room. His stance will be that he has less tightening bias but that he's north of neutral," our Rick Santelli says of Bernanke's likely comments.
A flash fire broke out in the oil market late yesterday as rumors flew that Iran made a strike on a U.S. ship. Oil jumped $5 in minutes in the thin trading of the after-hours session to a high of $68 a barrel before settling back down. Oil remains volatile this morning and has moved up sharply already, closing in on $65 a barrel. Inventory data is due out this morning.
Today, Britain vows its ship was in Iraqi waters and says it is halting official visits between the U.K. and Iran. Britain also suspended visas for Iranian officials. Iran, meanwhile, says the U.K. sailors it captured last week were in Iranian waters and that the standoff could be ended through "close cooperation," according to the IRNA, the official Iranian news agency.
More Housing Rubble
Beazer Homes confirmed Wednesday it was contacted by federal officials about its mortgage-lending business. According to the Wall Street Journal, Beazer says its internal investigation showed no evidence to support reports in the Charlotte Observer that described allegations of questionable loans arranged for buyers in a development with high foreclosure rates. Beazer says it was a broker, not a lender.
"Wal-mart Chief Writes Off New York," says the headline in the grey lady. Wal-Mart CEO Lee Scott met with editors and reporters at the New York Times and admitted defeat after failing to open the first Wal-Mart store in the city. "I don't care if we are ever here," he says to the Times. One would suspect he wouldn't object to New Yorkers shopping in his New Jersey stores however.