Before the bell 7-11-07: Futures indicate a possible higher start

U.S. stock markets may start on positive note this morning according to stock futures, as they seem to recover from yesterday's selloff sparked by earnings and subprime concerns. Update: It seems markets may have turned already an futures now (7:40 indicate a flat to lower start).

Yesterday, U.S. stocks tumbled more than 1% with the Dow shedding over 140 points and the S&P 500 declining more than 1.4%. Second quarter earnings warnings from retailers such as Home Depot and Sears Holdings, as well as S&P threatening to downgrade credit securities backed by subprime mortgage were among the main reasons for the decline.

Today, however, following the rally in Treasuries as investors fled to quality and after Chevron (NYSE: CVX) said it expects to beat its estimates for the quarter due to higher commodity prices and higher margins, it seems stocks may be in for a better day as Wall Street awaits earnings report after the close today by Yum Brands Inc. (NYSE: YUM) and Genentech Inc. (NYSE: DNA) with the hopes that these earnings could help turn the market around.

The dollar continues to get hammered. The British pound hit a new 26-year high against the dollar. The dollar hit yet another record low against the euro.
Crude oil prices are declining somewhat ahead of the weekly crude inventory report at 10:30. Traders expect U.S. fuel supply data will show that gasoline stocks rose last week.
Overseas, Asian markets finished lower, reacting to Wall Street. Exporters declined as the dollar weakened against the yen. European stocks also fell today, for a second day, with exporters there feeling the heat as well.

Corporate news:

Gerdau Ameristeel Corp. (NYSE: GNA) said it agreed to acquire Chaparral Steel Co. (NASDAQ: CHAP) for $4.22 billion. The $86 a share price for Chaparral represents a 14% premium over Tuesday's closing price.

Alcan Inc. (NYSE: AL) has begun talks with Rio Tinto PLC (NYSE: RTP) to fend off a hostile bid from U.S. rival Alcoa Inc. (NYSE: AA), according to Canada's Globe and Mail. Britain's Times newspaper also reported that Rio was poised to launch a $34 billion takeover of Alcan.

The never ending saga continues and now Ron Burkle and Web entrepreneur Brad Greenspan may unite and offer an alternative bid to that of Rupert Murdoch's News Corp (NYSE: NWS) for Dow Jones & Co. (NYSE: DJ).

According to the Wall Street Journal, Liz Claiborne Inc. (NYSE: LIZ) may cut 16 of its 36 brands. Today the company will also have an analyst day.