Futures Turn Higher on Earnings Strength
Futures moved into positive territory as a slew of companies, including several Dow components, reported earnings that beat expectations.
Caterpillar was the biggest market mover, with shares jumping more than 12 percent after the contruction equipment manufacturer posted earnings of 72 cents per share that shattered expectations of 22 cents.
Other companies performing strongly included Merck , which saw shares gain 3.4 percent, and Coca-Cola and Dupont, both which moved more than 1 percent higher premarket. Chemical company DuPont reported a sharp fall in quarterly earnings,but reaffirmed its full-year profit outlook.
United Technologies narrowly beat expectations but shares gained 1.7 percent premarket even after the company lowered its full-year outlook.
The list of other companies reporting earnings before the opening bell is an extensive one — including Continental Airlines , Lockheed Martin , Southwest Airlines , Merck , State Street and UAL .
The flood resumes after the bell, with reports from Apple , Advanced Micro Devices , Starbucks and Yahoo .
In between those two heavy doses of earnings, Fed Chairman Bernanke gives his semi-annual testimony on the state of the economy before the House, starting at 10 am New York time — a performance he'll repeat tomorrow morning before the Senate.
Once again, investors will be focused not only on the state of the economy, but any comments on exit strategies from the Fed's extraordinary measures that were put in place to deal with the financial crisis. Bernanke does discuss that very subject in an op-ed in Tuesday's Wall Street Journal.
CIT Group finally announced a $3 billion dollar agreement with bondholders for emergency funding — an announcement that was widely reported yesterday morning but did not officially come until Monday evening. Shares gained 5.6 percent premarket.
Texas Instruments will be a stock to watch, as the chipmaker beat estimates with its latest earnings. Shares fell 1.5 percent premarket.
Though the heavy batch of earnings will obviously impact Wall Street's direction Tuesday, there's little doubt about which way momentum is going at the moment, especially where the Nasdaq is concerned.
The Nasdaq Composite registered its ninth consecutive winning session Monday, its first such streak since July 8-20 of 1998 — coincidentally, the exact same date range of the current streak.
The Dow has six straight daily gains, while the S&P 500 has been higher in six of eight sessions. The Dow is now positive for the year and at its highest since January 6, while the S&P 500 and Nasdaq are at fresh 2009 highs.
California legislative leaders and Gov. Arnold Schwarzenegger have reached a compromise agreement on closing a $26 billion budget shortfall. That agreement still needs the approval of lawmakers.
— Peter Schacknow, CNBC Senior Producer, contributed to this report