SOTUS Reacts, Davos and "Business Nation"

Yahoo and Sun Micro are giving a boost to the Nasdaq this morning but the picture for stocks is mixed as investors await today's earnings reports. Europe and Asian markets were mostly higher, and the dollar is recovering some ground against the euro and sterling, after hitting a 14-year low against the British pound. In addition to Iraq, President Bush's State of the Union puts the focus on energy and health care today. Energy is also a big topic in Davos. Our Maria Bartiromo will be reporting from there today.

OIL LOWER: Oil moved lower overnight after a sharp runup to the $55 level yesterday on news the U.S. would double the Strategic Petroleum Reserves. Our Sharon Epperson says oil could be volatile today. When the news came out not long before the close: " Bulls that were on the sidelines said, "we've got to buy!" and it went up even more as traders covered shorts," she said. Today's action will be affected by inventory data, released at 1030 a.m. Any surprise could mean a big move, Epperson says. The U.S. government plans to double the strategic petroleum reserve to 1.5 billion barrels so there will be a supply of 97 days of net import protection vs the current 55 days. Bush discussed the plan in his State of the Union but the news was announced by the Energy Department yesterday afternoon. Interesting timing for a lift for oil after its big decline.

CORN CARTEL? Not clear who is thinking what in the big oil cartel OPEC this morning after President Bush's surprise plan to build up the Strategic Petroleum Reserve, but we will look at what it might mean for corn and food producers after his emphasis on alternate energy and ethanol in his State of the Union Address last night. Our Diana Olick will look at the trend that is pitting demands for food against fuel.

TECH HAPPINESS: Finally some joy in tech land. Both Yahoo and Sun Micro moved up in the after hours yesterday after issuing earnings reports. But excitement over Yahoo's comments that it will start seeing financial benefits next quarter from its new Panama search ad system turned its stock around and pushed it sharply higher though it reported a big, 61% drop in quarterly profits. Sun Micro reported larger than expected profits and is getting a boost from news that KKR is investing $700 million in the company. Goldman downgraded Yahoo to neutral.

EARNINGS CENTRAL: Conoco Phillips, McDonalds and Abbott Labs are among the companies reporting today, and eBay is expected after the bell.

WINGING IT: Airline mergers are the topic of a Senate Commerce Committee today. Delta CEO Gerald Grinstein meanwhile told the airline's employees that it is not involved in takeover talks with Northwest. Delta's ceo also called a possible deal with US Airways "the poster child of the worst kind of merger." US Airways is bidding $9.8 billion for Delta. Our Hampton Pearson will cover the committee today as the ceos of US Airways and Delta both testify. JP Morgan meanwhile downgraded Continental Airlines to underweight.

In other merger news, Goldman Sachs and Morgan Stanley are teaming up in a possible private equity deal for Dominion Resources that could top $15 billion, says the Wall Street Journal. They would join other private equity bidders for the company, and there's a rival group. Rupert Murdoch's News Corp joined the Chandler family in its bid for Tribune deal, with his focus on its Long Island newspaper, Newsday, says the FT.

BUSINESS NATION: We'll be watching when David Faber's new program "Business Nation" debuts at 10 pm ET tonight.