Stocks look to bounce back

NEW YORK (CNNMoney.com) -- Lower oil prices could help stocks rebound in the early going Monday following last week's dismal performance and ahead of the Federal Reserve's policy meeting later in the week.

At 7:30 a.m. ET, futures were slightly higher, pointing to a positive opening for U.S. stocks.

Oil prices were lower in early trading, after Nigerian unions ended a strike that had threatened to disrupt oil exports. U.S. light crude lost $1.21 to $67.91 a barrel in electronic trading.

Stocks were battered last week after the near collapse of two Bear Stearns (Charts, Fortune 500) hedge funds highlighted the risk posed by the subprime mortgage sector and raised concerns about trouble ahead for the credit markets. Rising Treasury yields also pressured sentiment.

Treasury prices were higher in early trading, taking the yield on the 10-year note to 5.11 percent from the 5.13 percent level reached late Friday.

Art Hogan, chief market analyst at Jefferies & Co., said that Wall Street traders seem more willing to take the glass-half-full view of the Treasury yields, seeing them as being lifted by the expectation of stronger economic growth ahead rather than inflationary pressures, which generally remain in check.

"As we reflect on how badly the markets did last week, the biggest driver was the yield on the 10-year," said Hogan. "The punishment probably didn't fit the crime."

This week, investors have a slew of economic reports to digest including the latest figures on existing home sales due from the National Association of Realtors at 10 a.m. ET Monday. Trading could also be volatile before the Fed releases its policy statement, due on Thursday at 2:15 p.m.

Hogan said that while economists are again forecasting weak home sales, he doubts that has the potential to cause selling in the market at this point.

"There's been such awful news out of real estate, you'd be hard pressed to shock the market negatively on home sales," he said.

Following Wall Street's sell-off on Friday, European shares opened lower, and most markets in Asia finished the session in negative territory. The dollar was higher against the euro but lower against the yen.

In major corporate news, Rupert Murdoch's News Corp. (Charts, Fortune 500) is closer to reaching an agreement with Dow Jones (Charts) over the editorial independence of the Wall Street Journal that could clear a way for the proposed purchase of the company, according to published reports.

Takeover talks heated up this weekend and the two sides neared an agreement on editorial integrity, the New York Times and Journal reported. News Corp. has made a $5 billion bid for Dow Jones.

Internet bellwether Yahoo (Charts, Fortune 500), which a week ago replaced its CEO, said Sunday the company is merging the two main parts of its U.S. advertising business under one sales executive and that veteran advertising sales executive Wenda Harris-Millard has left the company. She will become president of the media business of Martha Stewart Living Omnimedia (Charts), effective July 16, that company announced.

The movie "Evan Almighty," which with an estimated cost of $175 million is the most expensive comedy ever made, had an opening weekend box office of $32.1 million, which was seen as a disappointment for its distributor, Universal Pictures, a unit of General Electric (Charts, Fortune 500).