Stocks set for lower open on oil and Portugal debt

By @ibtimes on

Stocks were poised for a lower open on Wednesday, with oil prices edging higher on continued turmoil in Libya, and as a bond auction in Portugal failed to ease concerns the country would need a bailout.

Brent crude gained 1.2 percent to $114.43 a barrel while U.S. oil futures gained 0.4 percent to $105.44.

Libyan forces loyal to Muammar Gaddafi surrounded rebels in the western city of Zawiyah with tanks and snipers in the main square, witnesses said.

In Portugal, the government's two-year cost of borrowing hit the highest level since it joined the euro in a bond auction on Wednesday, and an official said yields were unsustainable in the long run without Europe-wide action.

The market has for a while absorbed the negative news, and the negative news is starting to mount, said Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati, Ohio.

That is the big question, how much more negative news can the market handle? I wouldn't bet against it here, but nonetheless, if 1,300 (on the S&P 500) eventually gives way on some negative news, we could be due for a well deserved break.

S&P 500 futures dipped 1.5 points and were below fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures added 1 point, and Nasdaq 100 futures lost 4.75 points.

Wednesday marks the two-year anniversary of the bull market run from a 12-year S&P closing low of 676.53 sparked by the financial crisis.

Texas Instruments Inc slipped 0.6 percent to $35.64 in premarket trades after the chip maker issued a current-quarter earnings target slightly below estimates, blaming weaker-than-expected demand for chips used in personal computers.

Suntech Power Holdings Co Ltd climbed 2.1 percent to $9.22 a day after the world's top solar panel maker posted sharply higher quarterly earnings and reiterated its 2011 revenue and earnings outlook, which were above estimates.

Finisar Corp tumbled 37.4 percent to $25.08 after the network equipment maker forecast a dismal fourth quarter, blaming an inventory pile-up by telecommunications equipment makers in China.

In a light session for economic data, investors will watch U.S. wholesale inventories for January at 10 a.m. (1500 GMT).

(Reporting by Chuck Mikolajczak; Editing by Padraic Cassidy)

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