NEW YORK, Oct 14 - U.S. stocks were set for a slightly lower open on Tuesday as investors pull back a little from 16-month highs hit the day before and examine a new raft of corporate earnings. Stock futures were mixed before the bell, with Dow Jones Industrials, Nasdaq 100 and Standard & Poor's 500 futures contracts trading slightly below fair value, pointing to a lower open. The market "is probably a bit ahead of itself at this point, but that doesn't mean the economics can't catch up," said John Davidson, president of Partner Re Asset Management Corp. There needs to be stronger evidence of job growth to sustain the economic recovery and the current stock rally, he said. Optimism about the earnings period has helped propel the market sharply higher this month, and investors are waiting for a rush of reports due in the next three weeks to see if Wall Street's recent gains are justified.
Headline stocks on Tuesday include financial giants Bank of America Corp. and Merrill Lynch , which were both trading higher before the bell after reporting better quarterly earnings than a year ago. Healthcare company Johnson & Johnson also reported higher quarterly profit, and was up on Instinet in before-market trade. Shares of data storage systems maker EMC Corp. fell before the bell as it said it would buy document software firm Documentum Inc. for about $1.7 billion.//