Updated from 7:27 a.m. EDT(At 4:55 p.m. EDT)
Elsewhere, Germany's SAP ( SAP) reported a decline in first-quarter net income as software revenue fell 33% in what the company called a "difficult operating environment." Shares were falling 3.7% in the premarket session. Siemens ( SI) also reported earnings before Wednesday's open. Second-quarter revenue rose 5% to 18.96 billion euros, and the German industrial conglomerate said total sectors profit in the second quarter rose 43% from a year earlier to 1.84 billion euros, led by strength in energy. Shares were jumping 6.3% in early trading. After Tuesday's close, E*Trade Financial ( ETFC) reported quarterly earnings, as the online brokerage acknowledged that it would need to raise more capital in conjunction with a first-quarter loss that widened when compared to the prior year. Shares were down nearly 25% ahead of Wednesday's session. Wyeth ( WYE), Qwest ( Q) and General Dynamics ( GD), among many others, will be reporting quarterly results ahead of Wednesday's open.
Citigroup ( C) was making headlines Wednesday after reports it is asking the Treasury Department for permission to pay special bonuses to many key employees, according to a report in The Wall Street Journal. The news comes one day after word that the government's stress tests of banks would show capital levels to be insufficient to weather the economic storm. A separate report in The Financial Times Wednesday says Citigroup has told U.S. regulators it could fill the capital shortfall by selling large businesses, asking more investors to convert their preferred shares into common stock and reducing its balance sheet. Speaking of the need for capital, Bloomberg reported Wednesday that at least 6 of the 19 largest U.S. banks require additional capital, according to preliminary results of government stress tests. The report cited people briefed on the matter. The report said that some of the lenders may need extra cash injections from the government, most of the capital is likely to come from converting preferred shares to common equity, according to sources. The Fed is now hearing appeals from banks, including Citigroup, that regulators have determined need more of a cushion against losses, according to the report.
Lewis is expected to win re-election to the company's board of directors, but a vote to strip him of the title of chairman was reportedly too close to call.