Wall Street heads to higher open after Citi report

[July 18, 2008]  NEW YORK (AP) -- Wall Street headed for a higher open Friday after Citigroup Inc. issued a better-than-expected earnings report, offsetting disappointing results from several other big companies.

The nation's largest bank reported a $2.5 billion second-quarter loss due to write-downs tied to deteriorating credit markets. However, that was still better than analysts' forecasts, and it appeared that the Dow Jones industrials would be able to extend their biggest two-day rally since 2002 when trading opens at 9:30 a.m. EDT.

Citi's report followed stronger-than-expected reports from JPMorgan Chase & Co. and Wells Fargo & Co. that helped relieve some of investors' worries about the health of the banking sector. Wall Street has grown concerned that souring mortgage debt would force some banks to go under. The Dow had triple digit gains Wednesday and Thursday in response to the banks' reports.

Futures began the day lower after Google Inc., Merrill Lynch & Co., and Microsoft Corp. had all posted quarterly results that missed analysts' expectations after the closing bell on Thursday. Meanwhile, oil prices moved higher after falling $15 over three days amid news of an output cut in Nigeria.

Dow futures rose 32, or 0.28 percent, to 11,433.

Standard & Poor's 500 index futures added 3.30, or 0.26 percent, to 1,256.70. Nasdaq 100 index futures rose 1 point, or less than 0.01 percent, to 1,840.00.

Bond prices were slightly lower Friday. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 4.01 percent from 4.00 percent from late Thursday.

The dollar was mixed against other major currencies, while gold prices rose.

Oil prices moved higher. Light, sweet crude rose $1.36 to $130.65 in premarket electronic trading on the New York Mercantile Exchange. Oil had declined $15 over straight days, feeding perceptions that the boom in raw materials may be cooling off.

Google's earnings growth bogged down more than investors anticipated during the second quarter, raising worries that the ailing U.S. economy is starting to sap the Internet search leader. The company missed Wall Street projections.

Merrill Lynch reported it lost $4.89 billion during the second quarter, hurt by almost $10 billion of write-downs and charges. The world's largest brokerage also sold its stake in news and data provider Bloomberg LP, and will sell its stake in First Data Services Inc., to raise capital.

Microsoft reported fiscal fourth-quarter profit jumped 42 percent -- or 13 percent factoring in a hefty charge a year ago. However, it missed Wall Street projections.

Overseas, Japan's Nikkei stock average fell 0.65 percent. In morning trading, Britain's FTSE 100 rose 0.60 percent, Germany's DAX index added 0.67 percent, and France's CAC-40 rose 0.65 percent.

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On the Net:

New York Stock Exchange: http://www.nyse.com/

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[Associated Press; By JOE BEL BRUNO]

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