Futures Rise Ahead of Bernanke Testimony

U.S. stock futures gained Tuesday ahead of Ben Bernanke's testimony before the Senate Banking Committee, where the Federal Reserve Chairman is expected to remain cautious about the outlook for the US economy in the face of rising oil prices.

Investors will listen out for any new insights into the Fed's quantitative easing program, which three Fed officials questioned in the past several days. Bernanke’s appearance is scheduled for 10 a.m.

Investors will also scrutinize any comments on inflation. Previously, Bernanke has said deflation is now less of a risk, but unlike other central bankers around the world he saw no inflation threat for the US.

Figures released in Europe Tuesday morning showed inflation was on the rise in the 17 countries that share the euro. Euro zone inflation rose to 2.4 percent in February, its highest level since October 2008.

After pausing Monday, oil prices rose Tuesday on rumors that Saudi Arabia had sent tanks to Bahrain to quell unrest. But an official from Saudia Arabia denied the report, which had surfaced in an Egyptian newspaper, according to Reuters.

London Brent traded above $112 a barrel, while U.S. light sweet crude was at nearly $98.

Treasury Secretary Timothy Geithner will address the House Financial Services Committee, also at 10 a.m.

Geithner was expected to say Congress should pass legislation overhauling the U.S. housing finance system within two years, though it should not act in haste, as this would be counterproductive.

Investors will also digest the February Institute for Supply Management manufacturing index and January construction spending figures.

The manufacturing index is expected to remain as good as unchanged at 60.5, while construction spending is forecast to fall 0.6 percent, a Briefing.com poll showed.

In addition, automakers are due to report February sales. U.S. sales were expected to show a gain of about 20 percent from the depressed levels of a year earlier in February, but analysts polled by Reuters said the rise in oil prices could slow or derail the recovery.

Nick Reilly, president of General Motors Europe told CNBC at the Geneva Motor Show Tuesday the market in Europe would be fairly stagnant this year. “Maybe overall up one or two percent,” he said.

AutoZone gained after reporting a 20 percent boost in fiscal second-quarter earnings.

Fresh Del Monte sank after disappointing fourth-quarter results as the produce distributor suffered from write-downs on some banana plantations.

And Las Vegas Sands fell after news the casino operator is being investigated by the Securities and Exchange Commission and the Department of Justice, according to the Wall Street Journal.

On Tap Next Week:

TUESDAY: Auto sales, ISM manufacturing index, construction spending; Fannie/Freddie reform hearing before House financial services committee; and Bernanke's semi-annual report on monetary policy to Congress.
WEDNESDAY: Mortgage applications, Challenger job-cut report, ADP employment report, oil inventories, Federal Reserve's Beige Book; Atlanta Fed President Lockhart speaks; earnings before-the-bell from BJ's, Costco and Staples.
THURSDAY: Chain store sales, ECB announcement, Monster employment index, jobless claims, productivity and costs, ISM non-manufacturing index, natural gas inventories, money supply; Minneapolis Fed President Kocherlakota speaks, Atlanta Fed President Lockhart speaks; earnings before-the-bell from Heinz, Kroger; earnings-after-the-bell from Novell.
FRIDAY: Non-farm payrolls report, factory orders; Federal Budget Deadline.

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