(By Salman - iStockAnalyst Writer)
US stock futures were flat on Wednesday as President Barack Obama's speech failed to generate much enthusiasm ahead of announcement of much anticipated "stress test" for US banks.
At 8:21 am ET, Standard & Poor's 500 Index futures expiring in March retreated 2.50 points to 766. Dow Jones Industrial Average futures fell 7 points to 7297. Nasdaq Composite Index futures increased 2 points to 1165.50.
In his first address to a joint session of Congress President Barack Obama on Tuesday said that America would emerge stronger out of recession. "While our economy may be weakened and our confidence shaken, though we are living through difficult and uncertain times, tonight I want every American to know this: We will rebuild, we will recover, and the United States of America will emerge stronger than before," Obama said.
The Obama administration is also expected to unveil "stress tests" on the 19 biggest US banks to determine how they would perform if the recession deepens.
In a testimony before congressional lawmakers, Bernanke said “I don’t see any reason to destroy the franchise value or to create the huge legal uncertainties of trying to formally nationalize a bank when it just isn’t necessary.” He added that the bank plan "has all the major components...of previous successful financial stabilization plans. So I think if it is well executed and forcefully executed, it is our best hope of stabilizing the system."
In its annual report filed with the U.S. Securities and Exchange Commission, Merrill Lynch & Co. said that it lost $15.84 billion in the fourth quarter, about $533 million more than the loss previously reported by Bank of America Corp. (NYSE: BAC).
According to reports, American International Group (NYSE: AIG) may discard a plan to repay a $60 billion U.S. government loan by selling assets, after it failed to find potential buyers.
Early on Wednesday, Ambac Financial (NYSE: ABK) announced that its fourth-quarter net loss narrowed to $2.34 billion or $8.14 a share compared to a loss of $3.27 billion, or $32.03 in prior year quarter.
Late on Tuesday, First Solar, Inc. (NASDAQ: FSLR) said that its fourth quarter profit jumped to $132.77 million or $1.61 per share from $62.87 million or $0.77 per share in the comparable quarter, a year ago. Revenue more than doubled to $433.65 million from $200.8 million.
Wynn Resorts (NASDAQ: WYNN) slipped to a fourth quarter loss of $159.6 million, or $1.49 a share from a profit of $65.5 million, or 57 cents a share in the fourth quarter of 2007. On an adjusted basis, the company earned $7.6 million, or 7 cents a share. Revenue plunged to $614.3 million from $711.3 million.
DreamWorks Animation Inc. (NYSE: DWA) reported that its fourth-quarter net income fell to $51.6 million, or 58 cents a share, from $94.1 million, or 98 cents a share, in the year ago quarter. Revenue declined to $199.8 million from $290.2 million.
On the front of economic data, existing home sales figure for the month of January is scheduled for release at 10:00 am ET.
European stocks advanced in afternoon trade. At 13:06 pm London time, the U.K. FTSE climbed 32.22 points or 0.84% to 3,848.66. The German DAX and French CAC gained 0.39% and 1.24% respectively.
Asian stocks finished with solid gains. The Nikkei 225 rose 192.66 points or 2.65% to 7,461.22. The Hang Seng index of Hong Kong advanced 206.56 points or 1.61% to 13,005.08.
NYMEX crude oil for April delivery climbed as much as 86 cents or 2.2% to $40.82 a barrel.
Disclosure: Author does not own any of the stocks discussed here.
