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) -- Stock futures were pointing to a stronger open Wednesday as investors absorbed stronger-than-expected Chinese growth ahead of

Federal Reserve

Chairman Ben Bernanke's testimony on the economy.

Futures for the

Dow Jones Industrial Average

were up by 40 points, or 66 points above fair value, at 12,453. Futures for the

S&P 500

were higher by 6 points, or 8 points above fair value, at 1317, and


futures were ahead by 13 points, or 17 points above fair value.

Stocks slumped Tuesday amid continued eurozone contagion fears and ongoing deficit-reduction deal negotiations in Washington.

China's gross domestic product jumped 9.5% in the second quarter from the prior year, exceeding expectations for an increase of 9.4%. That compares to growth of 9.7% in the first quarter.

Global investors appeared willing to focus on the encouraging data from China, putting concerns about the eurozone on the backburner.

The euro was strengthening 0.7% against the U.S. dollar, which was trading 0.6% lower against a basket of currencies.

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The FTSE in London was ticking 0.08% lower, while the DAX in Frankfurt was advancing 0.4%. Hong Kong's Hang Seng rose 1%, and Japan's Nikkei added 0.4%.

Ireland's government bonds were downgraded to junk status by Moody's late in Tuesday's session. The action came shortly after news that Italy accelerated efforts to pass a €40 billion ($56 billion) austerity plan.

Large European banks are taking measures to shield themselves if the situation in the eurozone spirals out of control, according to a

Wall Street Journal

report. Such measures include limiting lending to companies in Italy and Spain, holding more money with the

European Central Bank

and using credit-default swaps as protection against holdings of sovereign debt from struggling countries.

Meanwhile, negotiations over a deficit-reduction deal continue in Washington as the government nears its Aug. 2 deadline to raise the debt ceiling. If the federal borrowing limit isn't raised in the next three weeks, the U.S. will default on some of its financial obligations, putting its credit rating at risk.

Fed Chairman Ben Bernanke will deliver his semiannual monetary policy report, otherwise known as the Humphrey-Hawkins, before the House Committee on Financial Services at 10 a.m.

"We expect his comments to be broadly similar to what he said last month, following the FOMC meeting," said Deutsche Bank Chief U.S. Economist Joseph LaVorgna in a recent note. "The Chairman noted 'the economic recovery partly reflects factors that are likely to be temporary.' He also said the improvement in the job market 'remains frustratingly slow.' After Friday's data, he is almost certain to repeat this."

Regarding the European sovereign debt crisis, LaVorgna said Bernanke is likely to reiterate comments that Europeans understand the necessity of resolving the issue and to re-emphasize the difference of the current economic situation from that of last August, which prompted a second round of quantitative easing.

"While the economic and financial landscape has become more fragile since the Chairman's press conference, we expect him to repeat these comments, striking a continued cautious tone," he said.

Federal Reserve Chairman Ben Bernanke

The Bureau of Labor Statistics said import prices slipped 0.5% in June after adding 0.1% in May while export prices rose 0.1% from a prior increase of 0.2%. Excluding oil, import prices declined 0.1% after rising 0.4% in May, and excluding agriculture, export prices were unchanged after ticking 0.5% higher in May.

The U.S. Treasury will release its monthly budget report for June at 2 p.m. In May, the federal government posted a deficit of $57.6 billion.

In corporate news,

Capital One Financial

(COF) - Get Capital One Financial Corporation Report

saw its stock gain 1.6% to $53.09 during the premarket session after it surpassed analysts' second-quarter profit estimates with earnings of $1.97 a share. The company also said it will

move forward with a $2 billion common stock offering.

Shares of

Kinetic Concepts


were rising 4.5% to $67.40 ahead of Wednesday's opening bell on news that the

medical technologies company agreed to be bought by funds advised by Apex Partners, along with affiliates of Canada Pension Plan Investment Board and the Public Sector Pension Investment Board.

Late Tuesday,

Electronic Arts


agreed to acquire privately held

PopCap Games

, which makes popular digital game titles including



Plants vs. Zombies


Two new studies found that

daily pills prevented HIV infection in heterosexual men and women in Africa, according to an

Associated Press

report. The study used Truvada, an HIV treatment made by

Gilead Sciences

(GILD) - Get Gilead Sciences, Inc. Report


Shares of

ASML Holding

(ASML) - Get ASML Holding NV Report

were losing 1.4% to $34.40 during early trading after the

Dutch semiconductor equipment maker warned that third-quarter net bookings aren't likely to exceed €500 million.

At 10:30 a.m., the Energy Information Administration is expected to report a decline of 2.1 million barrels to crude oil inventories in the week ended July 8, according to a Platts survey of analysts.

Late Tuesday, the American Petroleum Institute said oil stockpiles gained 2.34 million barrels last week.

The August crude oil contract was shedding 50 cents to trade at $96.93 a barrel. Gold for August delivery was up by $11.60 at $1,573.90 an ounce.

The benchmark 10-year Treasury fell 15/32, lifting the yield to 2.933%.


-- Written by Melinda Peer in New York


Disclosure: TheStreet's editorial policy prohibits staff editors and reporters from holding positions in any individual stocks.