Stocks Headed Higher Before Bell

Strong earnings from SAP, WellPoint and Centex keep buyers interested.
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Stocks were poised for gains early Wednesday as more blockbuster dealmaking combined with falling oil prices to soothe nervous buyers.

Index futures recently showed both the

S&P 500

and Nasdaq 100 trading 3 points above fair value. The 10-year Treasury bond was down 4/32 in price to yield 4.41%, while the dollar fell against the yen and euro.

Tech futures rose after

SAP

(SAP) - Get Report

, the Germany software maker, reported a 14% rise in fourth-quarter earnings and raised margin guidance for 2006. The shares were up 10% in Europe.

Oil extended a three-day downturn ahead of potentially bearish readings on U.S. fuel inventories. Crude for March delivery was recently down 37 cents to $66.69 a barrel. Energy Department numbers are expected to show 1.4 million-barrel gains in crude and gasoline stocks, and an 875,000-barrel rise in distillates.

Overseas markets were mixed, with London's FTSE 100 recently up 0.7% to 5673 and Germany's Xetra DAX gaining 1% to 5388. In Asia, Japan's Nikkei was little changed overnight at 15,651, while Hong Kong's Hang Seng slipped 0.1% to 15,520.

U.S. markets had their second day of muted gains Tuesday, with the

Dow

and S&P 500 both adding about 0.2% and the

Nasdaq Composite

rising 0.8%. Stocks have now made up about a quarter of the losses they experienced in Friday's 2% selloff.

Corporate news was dominated by mergers and earnings Wednesday. The biggest piece is an apparent victory for

Boston Scientific

(BSX) - Get Report

in the takeover contest for

Guidant

(GDT)

. Guidant, a medical device maker, will reportedly accept Boston Sci's $27 billion offer Wednesday after

Johnson & Johnson

(JNJ) - Get Report

declined to raise its $24.2 billion bid.

Disney

(DIS) - Get Report

, meanwhile, confirmed a deal late Tuesday to acquire

Pixar

(PIXR)

for about $7.4 billion. The deal will leave

Apple

(AAPL) - Get Report

cofounder Steve Jobs as Disney's biggest individual shareholder.

Corporate earnings continue to cascade in.

WellPoint

(WLP)

posted adjusted fourth-quarter earnings of $1.05 a share, topping estimates by a penny. The managed care giant raised guidance for all of 2006 to $4.54 a share, although the forecast is slightly below existing estimates.

To view David Peltier's video take on today's premarket action, click here

.

On Tuesday,

Sun Microsystems

(SUNW) - Get Report

reported a second-quarter loss of $223 million, or 7 cents a share, reversing a profit in the year-ago period. Sales of $3.34 billion were about $140 million south of forecasts.

Corning

(GLW) - Get Report

lost $32 million, or 2 cents a share, on sales of $1.2 billion in its December quarter. Adjusted earnings of 22 cents a share met analyst forecasts. For the current period, Corning sees earnings of 22 cents a share on sales of $1.2 billion to $1.25 billion. Analysts were expecting 22 cents on $1.23 billion.

Homebuilder

Centex

(CTX)

said quarterly earnings rose 30% on strong home closings, and the company confirmed its outlook for both fiscal 2006 and 2007. Revenue rose 25% to $3.74 billion, shy of analysts forecast of $3.81 billion.

Netflix

(NFLX) - Get Report

soared after saying fourth-quarter earnings jumped 60% to $38 million, or 57 cents a share, on $195 million in revenue. The bottom-line number wiped out analysts 15-cent prediction.