Investors on edge

NEW YORK (CNNMoney.com) -- U.S. stocks futures drifted Wednesday morning, ahead of some key economic readings and comments by Federal Reserve Chairman Ben Bernanke.

Stock futures were lower early Wednesday as investors waited nervously for some key news due in the hour before the open.

At 8:30 a.m. ET the government releases readings on retail sales and inflation at the wholesale level. Then at 9:10 a.m. ET, Bernanke is set to speak at a conference on monetary policy at the CATO Institute.

"I would kind of think that retail sales will be the most important factor today," said Peter Cardillo, chief market economist at Avalon Partners. "Retail sales will give the market an indication of how the consumers are faring heading into the holiday season."

He said that if retail sales comes in at or above forecasts, it could give investors a green light to resume Tuesday's rally, but that a weak number could set off alarm bells.

Economists surveyed by Briefing.com forecast that retail sales gained only 0.2 percent in October, down from a 0.6 percent rise in September, due partly to weak auto sales. Excluding autos, those sales are expected to post a 0.3 percent rise after a 0.4 percent gain in the previous months.

The Producer Price Index, which measures prices at the wholesale level, is seen rising 0.3 percent in October due to higher energy prices after a 0.1 rise in September. The more closely watched core PPI, which strips out food and energy prices, is forecast to be up 0.2 percent, following a 0.1 percent gain.

Bernanke is due to speak on communications by the Federal Open Market Committee, the policymaking body that sets interest rates. Investors and economists will be looking for any clues in the speech about what the Fed might do with rates at its next meeting Dec. 11.

Cardillo doesn't expect much news out of Bernanke's speech, and he said investors are probably already looking past the PPI report to the Consumer Price Index, the government's key inflation measure at the retail level, due out Thursday morning.

Stocks rallied in a dramatic session Tuesday that sent the Dow Jones industrial average higher about 320 points.

Part of the good news lifting stocks Tuesday was a sharp sell-off in oil, which closed down more than $3 a barrel. But in early trading Wednesday, oil prices rebounded back above the $92 a barrel mark, gaining 92 cents to $92.09.

Still, even with the rise in oil prices, Asian markets closed higher, led by a 2.5 percent gain in Japan's Nikkei. European markets were higher in midday trading.

Other news lifting markets Tuesday were statements from some major Wall Street firms, which said they saw limited problems in the value of their holdings due to subprime and credit market woes.

Early Wednesday, HSBC Holdings (Charts) announced it was taking a $3.4 billion charge because of accelerating losses in its U.S. mortgage business. Shares of the bank slipped 0.8 percent in London trading, even as it said those losses were "more than offset by revenue growth in the group" as a whole and that it saw third-quarter operating income gains.

In other corporate news, billionaire investor Nelson Peltz made a Securities and Exchange Commission filing in which he announced he had submitted an offer to buy Wendy's (Charts), but at a lower price than what he previously said the nation's third-largest hamburger chain is worth. The filing did not say what the new price was - only that it was below the $37 to $41 a share range previously disclosed. But that was still enough to lift Wendy shares in after-hours trading, as they gained nearly 2 percent to $32.24.

Verisign (Charts), which has branched out from its core business of registering Internet names and providing security for online transactions, may pull back from that strategy. The company is expected to tell an analyst meeting that it plans to shed a slew of its business units in a corporate overhaul.

E-Trade Financial CEO Mitch Caplan reportedly canceled a scheduled appearance at a Merrill Lynch & Co. banking conference. E-Trade shares swung wildly earlier this week after it reported October operating results and an analyst suggested it was at risk for bankruptcy. Shares of E-Trade (Charts) lost 59 percent in trading Monday before rebounding 40 percent Tuesday.

Ford Motor CEO Alan Mulally told reporters at the Los Angeles Auto Show that Ford (Charts, Fortune 500) did not need a strategic partner elsewhere in the world or an outside investor to complete its restructuring and return to profitability in 2009. He said that such a combination would be a distraction for the company.

Department store retailer Macy's (Charts, Fortune 500) is due to report results before the market open Wednesday, with analysts forecasting a sharp drop in earnings on lower sales at stores open at least a year.