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Bernanke: recession possible

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NEW YORK (CNNMoney.com) -- Stocks were poised for a slightly lower open Thursday, but trading could be volatile as investors wait for more comments from Federal Reserve Chairman Ben Bernanke, news of a possible Senate deal to provide help to homeowners facing problems with their mortgages and Friday's jobs report.

About three hours before the market open, Nasdaq and S&P futures were down, pointing to a narrowly lower start for Wall Street.

Stocks finished a choppy session lower Wednesday after Bernanke said a U.S. recession is possible.

His statements came as investors are gearing up for Friday's closely watched March jobs report. The report is expected to show a decline of 50,000 jobs in the month, with unemployment rising to 5% from 4.8%, according to economists surveyed by Briefing.com. But a reading early Wednesday on private sector employment from payroll services provider ADP showed an unexpected gain of 8,000 jobs in March, raising some doubts about forecasts of the third straight month of declines in the Labor Department's count of jobs.

The Fed chief heads back to Capitol Hill today to face more questions, this time from the Senate Banking Committee, about the central bank's role in the rescue of Bear Stearns. He will be joined by executives from JPMorgan Chase (JPM, Fortune 500) and Bear Stearns (BSC, Fortune 500), as well as officials from the Treasury Department, Securities and Exchange Commission and New York Fed.

Bernanke and the other government officials could also see some more questions about proposals for direct Federal aide to homeowners facing problems with their mortgages. Senate Democrats and Republicans worked around the clock Wednesday to draft a bipartisan housing bill that has been fast-tracked for a debate and vote. News of those discussions helped to lift the stocks of homebuilders in Wednesday trading.

The legislation could go before the full Senate for discussion as early as Thursday. Bernanke declined to comment on the various proposals when asked about them during his Wednesday testimony, saying that was the Congress' decision, not the Fed.

Also on Capitol Hill Thursday are top executives from Southwest Airlines (LUV, Fortune 500), who are due to testify before the House Transportation and Infrastructure Committee on problems with safety inspections of its aircraft. Two Federal Aviation Administration inspectors told CNN Wednesday that Southwest tried to keep hidden serious problems with its maintenance program hidden and pressured the FAA to keep out an inspector who noticed the problems. The airline had no comment ahead of the hearing.

Other companies to watch Thursday include BlackBerry maker Research in Motion (RIMM), which beat forecasts for earnings and revenue when it reported fourth quarter results after the bell. Shares gained 5% in after-hours trading.

Schering-Plough (SGP, Fortune 500) announced plans to layoff 10% of its global staff, an effort to trim costs by $1.5 billion a year. Shares of the New Jersey drugmaker have tumbled 29% this week after top cardiologists criticized its crucial cholesterol drugs Vytorin and Zetia. Shares came back slightly in after-hours trading following the announcement, gaining 1.7%.

Search giant Google (GOOG, Fortune 500) also announced its first broad job cuts as it confirmed a report late Wednesday that it will layoff 300 workers, or about 25% of the staff at DoubleClick, its newly acquired ad-serving company. The job cuts affect only DoubleClick workers, not those who had been at Google.

Ralph de la Vega, CEO of the wireless arm of AT&T (T, Fortune 500), told reporters at a trade show late Wednesday that his firm now wants Google's new operating system for cell phones as part of its offerings. AT&T Mobility, the nation's largest wireless provider, had previously been reluctant to endorse Google's development efforts.

Oil prices retreated the day after jumping $3 a barrel on the weekly U.S. inventory report. A barrel of light sweet crude lost $1 to $103.83 in early electronic trading.

The high oil prices lifted gasoline prices to yet another record high, according to the AAA's daily price survey. A gallon of regular rose 0.2 cents to $3.289, topping the previous record set Monday and matched Wednesday.

In another sign of the problems for the companies from higher fuel prices and a slowing economy, embattled Indianapolis-based airline ATA Airlines announced it has discontinued all flights and filed for bankruptcy. The airline, which depended mostly on its charter business with only limited scheduled service, had been acquired out of bankruptcy by investment firm MatlinPatterson in 2006. Its Web site said the loss of a military charter contract forced it to finally halt operations.

In global trade, shares in Asia finished higher. European markets slipped in early trading. The dollar was stronger despite Bernanke's recession comment.