Wound-licking WednesdayU.S. stocks poised to rebound from huge selloff; GDP offers few surprises, Bernanke testimony on tap.NEW YORK (CNNMoney.com) -- U.S. stocks were poised for a big rebound at Wednesday's open, less than a day after a huge selloff that included the Dow industrials' biggest one-day drop since 2001. At 8:54 a.m. ET, Nasdaq and S&P futures, which predict the direction of stocks at the market open, were sharply higher following the worst day for stocks since the first day of trading following the Sept. 11 terrorist attack.
 
"After the violence of yesterday's (Tuesday's) selloff, it would be typical for us to rebound today," said Art Hogan, chief market analyst at Jefferies & Co. "If we do get a bounce, I wouldn't be surprised." Asian stocks continued the selloff that began Tuesday in China, although the Shanghai and Shenzhen indexes finished Wednesday with nearly 4 percent gains. A steep drop in those markets Tuesday is one of the factors credited with the global selloff of stocks. European markets were lower. A second reading on fourth-quarter gross domestic product came in slightly below estimates, and did little to move futures. The Commerce Department said fourth quarter GDP rose 2.2 percent, a big decline from the government's previous estimate of 3.5 percent growth but just below analysts' estimates of 2.3 percent. At 10 a.m. ET, Federal Reserve Chairman Ben Bernanke is set to testify before the House Budget Committee hearing on long-tern fiscal challenges and the economy." Questions about Tuesday's selloff in stocks are likely. "If he stays on message as he has in the past, it's not going to hurt market," Hogan predicted. Also at 10 a.m., the government will report on new home sales for January, the latest reading on the state of the closely watched and badly battered real estate market. Tuesday's report on existing home sales showed a continued decline in home prices in January but a pickup in the pace of sales. Home improvement retailer Home Depot (Charts) warned early Wednesday it sees the slump in home building and real estate continuing for as much as another year. It also warned investors that it is looking for a bigger than forecast decline in earnings for this fiscal year, along with a drop in sales at stores open at least a year, a closely watched retail measure known as same-store sales. Shares of the Dow component lost 2.3 percent in pre-market trading on the warning. At 10:30 a.m. will come the government report on U.S. fuel inventories. Oil eased ahead of that report. U.S. light crude was down 68 cents to $60.78 a barrel in electronic trading. Treasury prices, which soared Tuesday as equities plunged, retreated in early trading. The 10-year note yield rose to 4.53 percent from 4.51 percent late Tuesday. The dollar rebounded against the euro and the yen in early trading. In corporate news, Chrysler Group reached a deal with the United Auto Workers to offer union members at the company up to $100,000 to leave. The unit of DaimlerChrysler (Charts) is looking to cut 11,000 unionized employees in the coming years as it closes plants. Shares of DaimlerChrysler gained 0.8 percent in Frankfurt trading early Wednesday. Grocer Great Atlantic & Pacific Tea Co. (Charts), which operates the A&P chain, confirmed late Tuesday it was in talks to acquire smaller rival Pathmark Stores (Charts). A&P's shares were among the rare stock that gained during Tuesday's sell-off ahead of that confirmation, but shares lost 3 percent in pre-market trading Wednesday. ----- |
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