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 In the meantime, investors will be hearing from two rivals of Bear Stearns Cos.
-- Lehman Brothers Inc. and Goldman Sachs Group Inc. -- which are scheduled to release their fiscal first-quarter earnings Tuesday morning. Both are expected to post profits, but profits that are significantly lower than they were a year ago. Investors will want to get more details about the souring mortgage-backed bets on their books.
Stockholders have been especially pessimistic about Lehman Brothers, as it is the investment bank most similar in structure and exposure to Bear Stearns. Lehman shares fell 19 percent on Monday after JPMorgan Chase & Co. said Sunday it was buying Bear Stearns for just $2 a share, or $236 million.
The Fed on Sunday, in addition to guaranteeing up to $30 billion of Bear's most troubled assets for JPMorgan, lowered its discount rate
-- the rate it charges banks directly -- by a quarter-point. It also is allowing more types of financial firms to borrow from the central bank, and is accepting more various types of collateral.
After these signals that the Fed is ready to use everything in its arsenal to boost liquidity in the financial system, traders who bet on the Fed's next rate move are pricing in a 100 percent chance of a full-point rate cut. That would bring the target fed funds rate
-- the rate that banks charge each other for overnight loans -- to 2 percent from 3 percent.
Lower rates tend to trigger economic growth. But with the credit markets so tight with nervousness, many market watchers are unsure whether more rate cuts are going to be enough to loosen them up again.
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 Dow Jones industrial average futures rose 111, or 0.93 percent, to 12,108. Standard & Poor's 500 index futures rose 15.10, or 1.18 percent, to 1,294.60, while Nasdaq 100 index futures rose 18.2, or 1.41 percent, to 1,713.50.
On Monday, the Dow rebounded from an initial drop of nearly 200 points to finish up 21 points. The S&P 500 and Nasdaq indexes ended lower as investors fled instead to large companies apt to be reliable during a weak economy.
Bond prices fell. The yield on the benchmark 10-year Treasury note, which move opposite its price, rose to 3.36 percent from 3.30 percent late Friday. The dollar fell against most other major currencies, while gold prices rose.
Light, sweet crude rose $1.60 to $107.28 per barrel in premarket electronic trading on the New York Mercantile Exchange.
After selling off Monday, stock markets overseas rebounded. Japan's Nikkei stock average bounced 1.50 percent, while Hong Kong's Hang Seng index rose 1.4 percent. In midday trading, Britain's FTSE 100 rose 1.64 percent, Germany's DAX index added 1.71 percent, and France's CAC-40 increased 1.78 percent.
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On the Net:
New York Stock Exchange: http://www.nyse.com/
Nasdaq Stock Market: http://www.nasdaq.com/
[Associated Press; By MADLEN READ]
Copyright 2008 The Associated Press. All rights reserved. This
material may not be published, broadcast, rewritten or
redistributed.
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