Investors feeling chipper
Futures still point to higher open after good Intel outlook; JPMorgan results, in-line rise in inflation; but new home building plummets.
NEW YORK (CNNMoney.com) -- Stock futures continued to rise early Wednesday, lifted by an upbeat outlook from chip giant Intel, better-than-expected earnings from JPMorgan Chase and despite plummeting new home construction and rising inflation.
About three hours before the market open Nasdaq and S&P futures were higher and indicating opening gains for Wall Street, with techs poised to lead the advance.
Tech heavyweight Intel (INTC, Fortune 500), which is also a Dow component, reported first-quarter sales and full-year guidance late Tuesday that exceeded Wall Street estimates.
The strong results helped offset worries about the impact the credit crunch and slowing economy will have on corporate profits.
But jitters could return after financial firms JPMorgan Chase (JPM, Fortune 500) and Wells Fargo (WFC, Fortune 500) post their results. Both are due to report before the market open.
Washington Mutual (WM, Fortune 500), the nation's largest thrift, reported greater details after the close Tuesday of a $1.1 billion loss in the first quarter that it had pre-reported last week, as it was forced to set aside more money for bad loans. Still its shares rose 1.8% in after-hours trading.
Another financial giant to watch is Merrill Lynch (MER, Fortune 500), which is slated to post results Thursday. The bank is expected to post a loss and take $6 billion to $8 billion in mortgage-related writedowns, according to a report in the Wall Street Journal Wednesday.
The Journal also reported that there are growing concerns that banks around the world are not reporting high rates they're paying for short-term loans. That in turn is creating doubts about the London inter-bank offered rate, known as Libor, a key measure of the health of the global financial system. Libor is a rate calculated daily that is used to set rates on trillions of dollars in corporate debt, home mortgages and financial contracts.
While a Libor rate that is lower than actual results suggest it should be is good news for those borrowers at this point, it could suggest greater problems ahead for banks, according to the Journal. It also raises the risk of an interest rate shock to come if the rate undergoes an adjustment in how it is calculated. The British Bankers' Association, which oversees Libor, is now investigating suspicions that there rate is artificially low, according to the report.
The Labor Department said its Consumer Price Index for March, a key measure of inflation, rose 0.3%, in-line with predictions from economists surveyed by Briefing.com. The so-called core CPI, which strips out food and energy prices, rose 0.2%, also matching predictions. Both measures remained unchanged from the previous period in February.
But the government's Producer Price Index, the measure of inflation at the wholesale level, posted a 1.1% rise in March in a report released Tuesday, nearly twice as big a jump as forecasts. A bad reading on CPI could raise fears that inflation pressures could keep the Federal Reserve from acting aggressively to try to ward off a recession.
The Commerce Department reported Wednesday that housing starts and building permits hit a 17-year low for single family homes. The department said 927,000 new private building permits were issued in March, 5.8% below the previous month, and housing starts were at 947,000, down 11.9% from 1.07 million in February. Economists had predicted overall starts to fall to an annual rate of 1.01 million. Permits, which are taken as a reading of builders' confidence in the market, were predicted to fall to an annual rate of 970,000 from 984,000 in February.
Crude prices hit yet another record trading high in early electronic trading ahead of the weekly report on U.S. fuel supplies. A barrel of light, sweet crude rose 43 cents above Tuesday's record close to $114.22, although that was off of the earlier high of $114.50.
One factor lifting oil prices is weakness in the dollar. The euro hit yet another record high versus the dollar as the greenback also fell versus the Japanese yen.
In other corporate news, the number of U.S. consumers clicking on search ads at Google (GOOG, Fortune 500) wasweak once again in March, according to data released late Tuesday that some analysts said raised questions about the leader in online search will be able to meet consensus estimates when it reports first quarter results on Thursday. But Google's share of the search market still gained on rivals Yahoo (YHOO, Fortune 500), according to the same report from tracking service comScore. Shares of Google rose 1% in after-hours trading while Yahoo shares fell 1%.
In global trade, Japan stocks rose. Major markets in Europe also advanced in early trading. 
