LONDON -- The Dow Jones Industrial Average (INDEX: ^DJI) is expected open about 35 points lower today, according to futures markets this morning.
Markets closed higher last night after a late wave of buying, but expectations seem lower for Federal Reserve Chairman Ben Bernanke's second day of testimony on Capitol Hill. Traders will be looking for positive confirmation that Bernanke is planning another wave of quantitative easing -- something he seems unlikely to provide, based on yesterday's testimony. Bernanke's testimony begins at 10 a.m. EDT.
Also of interest this morning will be the latest housing start figures, which are due to be published at 8:30 a.m. EDT. Analysts' consensus forecasts suggest an increase of 42,000, taking the total number of housing starts in June to 750,000. Following this, at 10:30 a.m. EDT the U.S. Energy Information Administration's weekly petroleum status report will be published, and then at 2 p.m. EDT the latest Federal Reserve Beige Book will be released.
Earnings season continues today, with a number of big companies due to report. IBM, Honeywell, eBay, Yum Brands, and Blackrock are all among those due to release figures through the day and after the bell. A number of companies reported earnings before markets opened, including Bank of America (NYSE: BAC), which reported earnings per share 27% above analysts' expectations. Bank of New York Mellon (NYSE: BK) also reported before the bell, but may fall in early trading after reporting earnings 22% below analyst forecasts.
In Europe, government bonds in perceived safe-haven countries continued to rise in value. Germany sold 4 billion euros of two-year bonds at a record-low yield of 0.06%, while yields on U.K. two- and five-year bonds also dropped to their lowest-ever levels. Against this backdrop, Greek coalition party leaders held an emergency meeting in an effort to agree on a plan to achieve 11.7 billion euros of spending cuts in order to remain within the terms of their bailout agreement and gain access to the next installment of EU funds.
European markets traded cautiously during the morning session, with the DAX up 0.2% at 7 a.m. EDT, the CAC up 0.7%, and the FTSE 100 (INDEX: ^FTSE) up by just 0.1%. Beleaguered security services firm G4S led the gainers, recapturing some of its recent losses with a 3% gain. Gold miner Fresnillo was close behind, following a strong quarterly production report.
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