Stocks try to bounce back from previous day's drop

[October 20, 2010]  NEW YORK (AP) -- Stock futures bounced back slightly, a day after the market was hammered by a surprise interest rate hike in China and mixed earnings reports.

Earnings are again dominating headlines Wednesday. Quarterly results are due out from major banks, airlines and manufacturers throughout the morning. Internet companies take over after the market closes.

Traders who prefer to focus their attention on the broader economy will get a chance to review the Federal Reserve's beige book report in the afternoon. The beige book breaks down the health of the economy by region.

Wells Fargo & Co. and Morgan Stanley report earnings a day after bigger competitors Bank of America Corp. and Goldman Sachs Group Inc. each reported earnings that beat expectations. Wells Fargo's results should provide clues about whether customers are getting a better handle on their finances, while Morgan Stanley should further signal trading slowed down over the summer.

Manufacturers United Technologies Corp. and Boeing Co. also report results. The pair of Dow Jones industrial average components are bellwethers for the aerospace and other manufacturing sectors. Growth in those industries could be a sign companies are expecting building, shipping and travel to pick up in the coming quarters.

Delta Airlines, U.S. Airways and AMR Corp., the parent of American Airlines, also release results. If travel is rising as consumers take more vacations and businesses send employees on more trips, it should be apparent in their results.

Ahead of the opening bell, Dow Jones industrial average futures rose 30, or 0.3 percent, to 10,973. Standard & Poor's 500 index futures rose 5.10, or 0.4 percent, to 1,168.90, while Nasdaq 100 index futures rose 11.50, or 0.6 percent, to 2,079.00.

The dollar fell against other major currencies, a day after surging on the China news.

Stocks tumbled Tuesday after China's government raised a key interest rate to combat inflation. The Dow dropped 1.5 percent Tuesday, slipping back below 11,000.

Economic expansion in China has helped lift global growth while the U.S. and Europe's economies remain sluggish. Any signs throughout the year that the Chinese government would try to cool growth has hurt stocks.

Hong Kong's Hang Seng index fell 0.9 percent Wednesday.

Meanwhile, bond prices traded in a tight range. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 2.47 percent from 2.48 percent late Tuesday.

[Associated Press; By STEPHEN BERNARD]

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