Stock futures were negative in early morning but have changed direction and are now indicating to a positive start for the S&P 500 and possible higher start for the Nasdaq as well as investors are jittery ahead of a very busy week. This week will be not only busy with earnings results, but with economic reports and a Federal Reserve policy meeting.

After rising in Asia overnight, oil prices eased a little this morning while the dollar gained against the yen, but was unchanged against the euro.

In corporate news, first earnings:

Mattel Inc. (NYSE:MAT) posted a 3% fourth-quarter profit growth. Net income grew to $286.4 million, or 75 cents per share, on revenue of $2.11 billion, a 14% increase over last year. Analysts surveyed by Thomson Financial expected earnings of 67 cents per share on revenue of $1.99 billion.

Schering-Plough Corp. (NYSE:SGP) reported a 75% surge in fourth-quarter profit as net income totaled $182 million, or 12 cents per share. Excluding items, the company posted profit of 17 cents per share, in line with analysts' estimates.


In deal news, Citigroup Inc. (NYSE:C) has agreed to buy British insurer Prudential's Internet bank Egg for $1.13 billion in cash.

US Airways Group Inc. (NYSE:LCC) is willing to increase its hostile takeover offer for Delta Air Lines Inc. by $1 billion, according to people familiar with the matter, the Wall Street Journal reports.

There are a few rumors of deals that could affect certain stocks today, mainly relating Bank of America Corp. (NYSE:BAC) possibly making a bid for Countrywide Financial Corp. (NYSE:CFC), while Sanofi-Aventis and Bristol-Myers Squibb Co. (NYSE:BMY) could announce a merger. BMY shares are gaining 6.8% in pre-market.

Notable analysts calls this morning include upgrades to Buy of Home Depot Co (NYSE:HD) and Lowe's Companies (NYSE:LOW) by AG Edwards while Kroger Co. (NYSE:KR) was upgraded to Buy from Sell by Banc of America. Meanwhile MGM Mirage (NYSE:MGM) was downgraded by Bear Stearns to Peer Perform from Outperform.