* Morgan Stanley surges nearly 5 pct after results
* EBay, Intel fall after disappointing forecasts
* Investors await second day of Bernanke testimony
* Futures: Dow up 3.4 pts, S&P up 1 pt, Nasdaq up 0.75 pt
By Leah Schnurr
NEW YORK, July 18 (Reuters) - Wall Street was set to open
little changed as investors perused the latest corporate
results, including a jump in profit at Morgan Stanley, and
looked to a second day of congressional testimony by Federal
Reserve Chairman Ben Bernanke.
Shares of Morgan Stanley surged 4.9 percent to $27.83
in premarket trading after the bank reported
stronger-than-expected adjusted quarterly profit as revenue grew
in all of its major businesses.
Analysts' estimates for company earnings have been lowered
so much that investors believe the low targets should be easily
exceeded. Instead, investors will likely zero in on revenue
figures and outlooks.
"It's not really all that hard for companies to beat
scaled-back estimates," said Peter Cardillo, chief market
economist at Rockwell Global Capital in New York.
"Most companies are beating estimates but of course revenue
is a different story. Revenue growth is probably going to be the
negative part of another good earnings season."
IBM raised its full-year outlook and reported
earnings that beat estimates, though the company missed on
revenue. Shares of International Business Machines rose 2
percent to $198.50.
Analysts expect S&P 500 companies' second-quarter earnings
to have grown 3.3 percent from a year earlier, with revenue up
1.2 percent, according to Thomson Reuters data.
Shares of eBay slumped 6.6 percent to $53.58 after
it said full-year results would be at the low end of its
forecast range, while Intel tumbled 2.9 percent to
$23.45 after the company cut its full-year revenue forecast. The
drop in both stocks could weigh on Nasdaq during the session.
Other major companies due to report include Google
S&P 500 futures rose 3.4 points and were above fair
value, a formula that evaluates pricing by taking into account
interest rates, dividends and time to expiration on the
contract. Dow Jones industrial average futures added 1
point, while Nasdaq 100 futures edged up 0.75 point.
Economic data was encouraging as the number of Americans
filing new claims for jobless benefits dropped more than
expected last week in a sign that hiring may pick up in July.
Later in the morning, data on manufacturing activity in the
mid-Atlantic in July and economic leading indicators for June
will be released.
With the benchmark S&P up nearly 18 percent for the year,
investors are alert to any signs of how soon the Federal Reserve
will start to wind down the pace of its $85-billion monthly bond
purchases, a key driver of the equity market rally this year.
Speaking before Congress on Wednesday, Bernanke stressed the
timeline for winding down the Fed's stimulus program was not set
in stone, which helped Wall Street end modestly higher.
Bernanke said the central bank still expects to start
scaling back its bond purchases later this year, but suggested
that plan could change if the economic outlook shifts.
The Fed chairman will appear for a second day of testimony
before the Senate Banking Committee on Thursday.
Opposition to Michael Dell's bid to take his computer
company private grew on Wednesday. Holders of nearly 30 percent
of Dell stock oppose a $24.4-billion offer by founder Dell and
private equity firm Silver Lake, which is scheduled for a vote
in Austin, Texas on Thursday morning. Dell was up 2.6 percent at
Johnson Controls shares jumped after it reported
better-than-expected results and said it would sell part of its
auto electronics business. The stock rose 5.7 percent to $39.45.