U.S. Stocks Set for Higher Start - TheStreet

Updated from 7:54 a.m. EDT

Premarket index futures were indicating a slightly higher open Wednesday as stocks in Europe enjoyed a rally and the rise in crude oil prices slowed.

Futures for the

S&P 500

were up 5 points at 1294 and were 5 points above fair value.

Nasdaq

futures were up 13 points at 1883 and were 10 points ahead of fair value.

In Europe, shares of

UBS

(UBS) - Get Report

and

Deutsche Bank

(DB) - Get Report

were on the rise as the firms said they won't need fresh capital to improve their balance sheets. Shares of both banks have been declining recently on persistent credit crunch-related worries.

Among U.S. companies,

Microsoft

(MSFT) - Get Report

is once again working to ink a deal to get

Yahoo!'s

(YHOO)

search business, according to a report in

The Wall Street Journal

.

Several companies offered updates to their turnaround strategies. Latte maker

Starbucks

(SBUX) - Get Report

announced late Tuesday that it would be closing 600 of its U.S. stores in an effort to turn around the franchise, effectively ending an era of rapid growth for the company. Several thousand jobs will also probably be cut.

Meanwhile, video rental chain

Blockbuster

( BBI) said it was no longer planning to buy flagging electronics retailer

Circuit City

(CC) - Get Report

. The proposed deal had been worth more than $1 billion.

Analyst actions may have some bearing on certain financial stocks' moves.

Fifth Third Bancorp

(FITB) - Get Report

got a Robert W. Baird upgrade to outperform from neutral. On the other hand, RBC Capital Markets cut its price targets for

Wells Fargo

(WFC) - Get Report

and

Bank of America

(BAC) - Get Report

.

Meanwhile,

UnitedHealth

(UNH) - Get Report

cut its 2008 earnings estimates, citing increased Medicare costs and declines in commercial business.

General Motors

(GM) - Get Report

, which helped the market rally from an early selloff Tuesday, suffered a Merrill Lynch downgrade to underperform from buy. Merrill cut its price target for GM to $7 from $28 and said the company needs $15 billion in additional capital.

As for commodities, crude oil was recently up 34 cents at $141.31. Gold was falling $4.40 to $940.10.

In economic data, the ADP nonfarm payroll numbers showed that the U.S. lost 79,000 jobs in June, a much bigger decline than economists' prediction of 20,000. The estimated change in employment for May was revised down to an increase of 25,000 jobs from 40,000. On Thursday, the Labor Department will issue its monthly report, a data set that often moves the market.

The Census Bureau will also be offering May factory orders, which analysts expect to increase 0.5%. The June 28 crude inventories number will give some insight into where oil prices can go from here.

Treasuries were rising. The 10-year note was up 5/32 to yield 3.99%, and the 30-year added 10/32, yielding 4.53%. The dollar was weaker against the euro, but gaining on the yen and the pound.

Abroad, European markets were slightly stronger, while Asia's exchanges suffered. The FTSE in London and the DAX in Frankfurt were both higher, while the Tokyo's Nikkei and Hong Kong's Hang Seng were down more than 1%.