Stocks are poised to open higher on Tuesday as strong results from Merrill Lynch & Co. and Novellus Systems fueled anticipation for more solid earnings and U.S. retail sales rose more than expected last month. Retail sales, which make up about one-third of overall consumer spending, rose a surprisingly sharp 1.8 percent in March, their biggest gain in a year, the government said before the market's open. Wall Street analysts had expected a rise of 0.6 percent. February sales were also revised upward. As the quarterly reporting season heats up, Merrill Lynch , one of the biggest U.S. brokerages, said its quarterly profit almost doubled from a year ago. Merrill said the rise was driven by strength in trading and arranging stock and bond sales for corporate clients. Its shares rose 37 cents to $60.10 on the INET electronic brokerage before the open. "Things seem pretty upbeat at the moment. We had some good news from Merrill, and State Street also did well," said Edgar Peters, chief investment officer at PanAgora Asset Management in Boston.
Equity index futures pointed to a positive open. Standard & Poor's 500 stock index futures for June were up 5.50 points, while Nasdaq 100 futures for the same month rose 9.00 points. Dow industrials futures rose 49 points. "The earnings news is generally upbeat, and futures are pricing themselves for a pop at the open. Whether it holds up or not we'll have to see, but at the moment it looks pretty positive," Peters said. Financial services firm State Street Corp. said its quarterly earnings more than doubled, largely from a rebound in equity markets. Novellus , which makes machines that make computer chips, reported after Monday's close a 40 percent jump in quarterly earnings, and forecast a rise in earnings and revenue in the second quarter. Its shares rose 1.5 percent to $35.17 on INET before the open. Wall Street is also bracing for results from Intel Corp. , the world's largest microprocessor maker, which reports results after Tuesday's close. Intel shares rose 22 cents from their close to $27.82 in active trading on INET. In other economic news, the Commerce Department will issue business inventories data for February at 10 a.m. (1400 GMT) Economists polled by expect a median rise of 0.3 percent, versus a 0.1 percent increase in the prior month.///