August 17, 2004

NEW YORK (CNN/Money) - Oil's easing below $46 a barrel in overnight trading helped push U.S. stock futures slightly higher ahead of Tuesday's trading.

Early Tuesday, Nasdaq and S&P futures were up slightly.

Oil prices continued to pull back in the wake of Venezuela's recall election, in which 58 percent of voters agreed to let President Hugo Chavez serve the last two years of his term. U.S. crude futures fell 25 cents to $45.80 a barrel in electronic trading, more than $1 below the intraday record set early Monday. Brent oil futures slipped 34 cents to $42.35 a barrel in London.

Economic reports due early Tuesday will give the latest readings on inflation, housing and factory activity.

The consumer price index, which measures retail prices, is expected to have risen 0.2 percent in July, according to economists surveyed by Briefing.com, compared with a 0.3 percent rise in June. The so-called "core-CPI," which excludes often volatile food and energy prices, is also forecast to be up 0.2 percent after a 0.1 percent rise in June.

Housing starts are forecast to show an annual pace of 1.9 million in July, following a 1.8 million pace in June. Building permits are expected to come in at a 1.95 million pace in July, little changed from the June reading.

Briefing.com's survey also found economists looking for a 0.5 percent rise in industrial production in July, following a 0.3 percent decline in June. Factories are seen working at 77.5 percent of capacity compared with a 77.2 percent rate in June.

In corporate news, Home Depot (HD: Research, Estimates), the largest home improvement retailer, reported it earned a record 71 cents a share in the fiscal second quarter, excluding special items, easily topping the consensus EPS forecast of 64 cents as well as year-earlier earnings of 56 cents a share.

Companies set to report results after the market close Tuesday include Applied Materials (AMAT: Research, Estimates), which makes equipment used by computer chip makers; the results are expected to be improved over the year-earlier period.

Search engine Google could set the price for its initial public offering later Tuesday, clearing the way for its shares to start trading Wednesday. The company said in a filing Monday that it asked the Securities and Exchange Commission to declare the company's registration settlement effective Tuesday afternoon.

A drop in oil prices during the day Monday helped stocks start the week with gains. The Dow Jones industrial average added 1.3 percent, while the Nasdaq composite index rose 1.5 percent.

Asian-Pacific stocks finished mostly higher, with Tokyo's Nikkei index up 0.4 percent. European stocks rose in early trading. (Check the latest on world markets)

Among U.S. stocks trading in Europe, Apple Computer (AAPL: Research, Estimates) dropped more than 2 percent. Music download rival RealNetworks (RNWK: Research, Estimates) has cut its per-song price to 49 cents temporarily in an effort to cut into the dominance of Apple's iTunes. Real also said the drop in revenue it expects from the price cut could increase its third-quarter loss by 1 cent per share.

Treasury prices fell in early trading, sending the 10-year note yield up to 4.27 percent from 4.26 percent late Monday. The dollar slipped against the yen, but was higher versus the euro. Gold was lower.

Motorola (MOT: Research, Estimates), the world's No. 2 mobile phone maker, said early Tuesday it expects to sustain strong sales growth in the second half of 2004 thanks to new handsets which it said gave it better presence in the high end of the market.

Tyson Foods (TSN: Research, Estimates), the world's largest meat and chicken processor, said late Monday it had been notified by the SEC that its staff intends to recommend a civil action against the company. The action would center around allegations that Tyson did not comply with regulations on the full description and disclosure of perquisites for former Senior Chairman Don Tyson in its proxy statements from 1997 to 2003.

Also facing an legal trouble is Canadian telecom equipment maker Nortel Networks (NT: Research, Estimates), which warned Monday the Royal Canadian Mounted Police will begin a criminal investigation into Nortel's financial accounting. The company had already announced it would need to restate results for the 2001 to 2003 period.

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