Stocks Pushing Higher Ahead of Earnings Season

With warnings mostly history for the quarter, investors have the rose-colored glasses back on.
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Yesterday's sloppy action behind it, Wall Street is ready to send stocks higher this morning.

In a lot of ways, it's typical action. Following a weekend in which all the bulls' fears, and the bears' hopes, came to naught, stocks rally hard on Monday. Tuesday they spend some time on the couch digesting gains, and Wednesday they head higher again.

It helps, too, that

Gillette's

(G) - Get Report

warning Monday night was probably the last of the big confessions that precede earnings season. Companies will begin to report their first-quarter numbers next week, and if past is prologue, they will come in a bit better than analysts expect, casting a positive bias on stocks.

Once more, it looks like the .coms will be the flavor of day. "The Internet stocks again are up and there's no sign of those letting up," said Dan Mathisson, head stock trader at

D.E. Shaw

. Attention is centering on

Yahoo!

(YHOO)

, which reports first-quarter earnings after the close. The

First Call

consensus estimate is for the company to earn 8 cents a share. Last week this time it was 7.

But the market expects better than that. "The number I heard people tossing around this morning is 9 or 10 cents as the whisper," said Mathisson. But if Yahoo! continues to rise, those whisper numbers will see some upward revisions. Said Mathisson, "By the time the earnings come out, who knows? What defines a good number?"

At 9 a.m. EDT, the

S&P 500

futures were up 5.3, more than 8 above fair value and indicating a positive open. The 30-year Treasury was off 7/32 to 95 26/32, lifting the yield at 5.54%.

Tokyo stocks moved higher. Again, it was foreign buyers who were behind the move -- Japanese investors remain cautious. The

Nikkei

added 74.79 to 16,554.5.

Mitsubishi

and

Mazda

were notable gainers on reports that the two are considering a tie-up.

Hong Kong traders came back from a five-day weekend, looked at how overseas markets had performed during their absence and liked what they saw. The

Hang Seng

added 541.89, or 4.9%, to 11,614.87 -- a 12-month high.

Amid expectations that the

European Central Bank

will cut rates at its meeting tomorrow, European bourses are rallying. In Frankfurt, the

Dax

was up 75.57, or 1.5%, to 5040.86. In Paris, the

CAC

was up 15.38 to 4319.86.

Over in Britain, the

Bank of England

is meeting today and expectations there, too, are for a rate cut to be announced tomorrow. The

FTSE

was up 66.6, or 1%, to 6481.9.

Wednesday's Wake-Up Watchlist

By

Brian Louis

Staff Reporter

  • BMG, a unit of Bertelsmann, and Universal Music, a unit of Seagram (VO) - Get Report, are expected to announce a joint Internet venture today, according to published reports. The New York Times reported the companies are expected to unveil a venture to create a series of Internet sites to promote and sell music, citing record industry execs.
  • A California state judge sliced in half a jury's $50 million punitive damage award against Philip Morris (MO) - Get Report. In the case, brought by a former smoker suffering from inoperable cancer, the judge let stand an award of $1.5 million in compensatory damages. Last week, an Oregon jury ordered Big Mo to pay more than $80 million to the family of a smoker who died of cancer.
  • Alcoa (AA) - Get Report posted first-quarter earnings of 60 cents a share, beating the 16-analyst First Call consensus estimate of 54 cents, but down from the year-ago 62 cents. In other news:
  • Morgan Stanley Dean Witter initiated coverage of the recently merged AstraZeneca (AZN) - Get Report with an outperform rating.
  • @Home (ATHM) - Get Report set a pact with Japan's leading cable operator, Jupiter Telecommunications and with trading titan Sumitomo to form @Home Japan, which will develop and market a Japanese version of @Home's high-speed cable Internet service into Japan.
  • Boeing (BA) - Get Report plans to sell its Boeing Information Services unit. The division provides information and systems-integration services to the federal government. Boeing said it's in talks with potential buyers and expects to announce a buyer in the second quarter.
  • Hewlett-Packard (HWP) and software maker BEA Systems (BEAS) set an alliance to provide the companies' customers with a software infrastructure for building e-commerce solutions and integrating enterprise applications. Under the pact, Hewlett-Packard is committing $100 million to BEA Systems over three years.
  • Intimate Brands' (IBI) March same-store sales rose 21%, and the operator of Victoria's Secret stores said it expects to report first-quarter earnings a penny above the current 22-analyst First Call consensus estimate of 18 cents a share.
  • Peapod's (PPOD) Chief Operating Officer John Walden has resigned to become president of the Internet commerce division of Best Buy (BBY) - Get Report, Peapod said.
  • Some analysts expect Charles Schwab (SCH) , the discount and online broker, to split its stock sometime after its annual shareholders' meeting next month, the Heard on the Street column in The Wall Street Journal reports.
  • Yahoo! is slated to report earnings today. TheStreet.com previewed the earnings report yesterday.