Stocks set for stronger open

Early look at the markets

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NEW YORK (CNNMoney.com) -- Stocks headed for a stronger open Tuesday as falling oil prices met with nervousness about corporate profits and mounting woes in the financial sector.

At 8:59 a.m. ET, Nasdaq and S&P futures were higher, suggesting opening gains for Wall Street.

Stocks ended a wild ride in the red Monday, with the broad S&P 500 index finishing just a shade above bear market levels - or 20% below its peak in October. The Dow and Nasdaq fell into bear territory late last week.

"We're way oversold on a technical level," said Dave Rovelli, managing director of U.S. equity trading at Canaccord Adams. "I think we'll get a rally in the next few days."

Mortgage woes Worries about deepening problems facing mortgage lenders pressured stocks Monday, with Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500) both plunging on concerns that they will have to raise additional capital.

But shares of both government-backed lenders rose in premarket trading Tuesday morning.

Meanwhile, battered mortgage lender IndyMac Bancorp (IMB) said late Monday that it has stopped accepting new loan submissions in its main mortgage lending business and plans to slash 3,800 jobs to raise capital and stay afloat.

Fed speak The Federal Reserve is considering giving troubled financial firms more time to access emergency loans directly from the central bank to cope with credit problems, chairman Ben Bernanke said at a forum on mortgage lending.

Treasury Secretary Hank Paulson was also slated to appear at the forum.

Meanwhile, Richmond Fed President Jeffrey Lacker was scheduled to speak about the U.S. economic outlook in Washington.

Merrill Lynch A Wachovia analyst warned that investment bank Merrill Lynch (MER, Fortune 500) could face more writedowns and may have to sell some of its interests to cope with adverse credit conditions.

Energy Oil prices retreated, adding to the decline of nearly $4 in the previous session. Crude for August delivery was down $2.56 at $138.81 a barrel in electronic trading.

A stronger dollar and a perception that geopolitical volatility is abating has helped bring down the price of oil recently. But many analysts predict the easing of oil prices to be short lived.

Housing The National Association of Realtors was scheduled to release its index of pending home sales for May shortly after the opening bell.

Economists polled by Briefing.com expect the NAR's index declined 2.8% in May after unexpectedly climbing 6.3% in April.

Earnings Alcoa (AA, Fortune 500) was scheduled to become the first Dow component to report second-quarter results after the market closes. High commodity prices and weakening demand are expected to have hit the aluminum giant.

Alcoa is forecast to report earnings per share of 66 cents, down 18.5% from 81 cents per share a year earlier, on revenue of $7.36 billion, according to a consensus estimate of analysts compiled by Thomson Financial.

Investors will also be watching General Electric (GE, Fortune 500), which reports results Friday. The industrial conglomerate has been struggling amid the weakening economy.

Other markets. In global trade, Asian markets ended lower, with Japan's Nikkei touching a 3-month low. European shares fell sharply in morning trading.

The dollar continued to strengthen against the euro. The 15-nation currency traded at $1.5685, down from $1.5733 late Monday in New York.

Bond prices rose. The benchmark 10-year note added 1/32 to 99 23/32, lowering its yield to 3.90% from 3.91% late Monday.

Gold prices fell $8 to $920.80 an ounce in premarket, electronic trading.