(Updating with fresh levels, Merck, Schering-Plough results)
LONDON (Thomson Financial) - Wall Street is set to rebound from heavy prior-session losses after strong quarterly results from drug giants Schering-Plough and Merck, with corporate takeover activity underpinning gains as Hewlett-Packard announced a 1.6 bln usd acquisition.
Dow futures were up 32 points at 13,970, S&P 500 futures rose 3.10 points to 1,548.20 while Nasdaq 100 futures gained 1.75 points to 2,057.
With a quiet day on the economic calendar, 'we could be in for a day of range trading', according to CMC Markets.
But many traders still 'retain a positive bias for the major indices as long as they remain above what are seen as key short-term support levels. For the Dow this is the 13,800 mark which has underpinned the market for the past ten days, while for the S&P 500, the level to watch is 1,525,' CMC added.
Last Friday, stocks ended sharply lower to wrap up a negative week for the market after earnings reports from Caterpillar and Google disappointed.
Snapping a three-week run of gains, the Dow fell 0.4 pct while the Standard & Poor's 500 Index gave up 1.2 pct. The Nasdaq composite index posted a weekly loss of 0.7 pct.
Stock futures received a fillip after drugs group Schering-Plough Corp posted second-quarter results that topped analysts' expectations, with seven out of its ten biggest-selling products posting double-digit sales growth. The stock was up 3.6 pct at 32.61 usd in pre-market dealings.
Dow member Merck followed suit as it posted quarterly earnings that also came in ahead of analyst estimates.
The drugs group also offered up a 2007 forecast range of 2.80 usd to 2.95 usd, with the upper end of the range just topping the 2.94 usd a share forecast by the average estimate of analysts polled by Thomson Financial. Merck was last up 4.6 pct at 51.25 usd in pre-market dealings.
In addition, there was solid earnings news out of oil services provider Halliburton, which was up 3.4 pct at 37.80 usd ahead of the bell.
The company posted stronger-than-expected adjusted quarterly results as revenue shot up 20 pct to 3.7 bln usd from a year ago, due to 'increased worldwide activity, particularly in the Eastern Hemisphere', the company said.
On the merger and acquisition front, computer and printer company Hewlett Packard Co it will buy data centre automation software company Opsware for about 1.6 bln usd, or 14.25 usd per share in cash.
Elsewhere, Tellabs soared 18.7 pct to 14.07 usd in pre-market dealings on reports Nokia Siemens Networks may launch a 7 bln usd takeover offer for US telecommunications systems supplier.
Shares in Anheuser-Busch edged up 0.8 pct in thin pre-market dealings after Citigroup said it sees a 70 pct chance of the maker of Budweiser beer tying up with European brewer InBev in the next two years. The broker raised its recommendation on both Anheuser-Busch to 'hold' from 'sell' and a raised price target of 52 usd. It lifted InBev to 'buy' from 'hold.'
US media groups Viacom and Time Warner will likely see active trading after the UK's Sunday Times reported that the two companies are among 11 parties interested in buying the UK cable, broadband and phone group Virgin Media.
Wal-Mart Stores rivals, such as Target Corp, may come under pressure after the world's largest retailer said it would launch an aggressive new discounting program focused on back-to-school items in a move to combat the effect of high gas prices on customers' spending volume.
Outside of equities, oil prices fell after the Organisation of the Petroleum Exporting Countries' (OPEC) new president Mohammed Al Hamli intimated the cartel may increase production if high energy prices look set to threaten global growth.
New York light sweet crude for August delivery was last down 44 cents at 75.35 usd a barrel.
The US dollar was just off a fresh all-time low against the euro, with little sign of a let-up in concerns surrounding the US sub-prime mortgage sector.
The euro was last down just 0.1 pct at 1.3812, only slightly under its all-time high of 1.3844 usd. Against the Japanese yen, the dollar was little changed to stand at 121.24.
On the bond market, concern over the sub-prime mortgage market continued to buoy Treasuries. The yield on the benchmark 10-year note, which moves in opposite direction to the price, was last at 4.94 pct versus 4.95 pct on Friday. Mark.cotton@thomson.com mc1/jfr/mc1/am/mc1/slj COPYRIGHT Copyright AFX News Limited 2007. All rights reserved. The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.