U.S. MARKET AVERAGES

Dow Jones futures were recently up 22 points, while Nasdaq futures climbed 5 points and S&P futures edged up 1.3 point.

After the bell Monday, IBM reported that its 2Q net income rose 5.4% to $1.83 billion, or $1.12 a share, from $1.74 billion, or $1.01 a share, a year earlier. IBM's income from continuing operations came in at $1.14 a share, well above Wall Street's expectations of $1.03 a share.

After Monday's closing bell, IBM, the world's largest computer company, rose to $85.40 from a close of $81.81.

ECONOMIC NEWS

The Commerce Department is expected to release the June housing start report at 8:30 a.m. Economists are looking for a 2% jump to an annual rate of 2,050,000 for housing starts in June. Building permits are seen up by 1.8% to an annual rate of 2,100,000.

Greenspan is expected to testify before Congress on Wednesday and Thursday.

INTERNATIONAL MARKET NEWS

Asian markets closed mixed Tuesday, with Korean stocks advancing due to weakness in the won, Australian stocks sliding on resource stock retreat and Japanese shares ending slightly up ahead of earnings releases.

In Tokyo, the Japanese markets reopened after a national holiday with the Nikkei 225 ending the session up 6.16 points at 11,764. In Hong Kong, the Hang Seng index was up 0.05%, Australia's All Ordinaries lost 0.47% and the Seoul Composite advanced 1.2% due to weaker won vs. the U.S. dollar.

In Seoul, market leader Samsung Electronics (SSNGY: chart) gained 2% and Hyundai Motors (HYMLF: chart) jumped 3.6%.

Fresh merger and acquisition activity in the beverage sector, combined with the strong results from IBM overnight and a weaker euro gave a boost to European markets. Germany's DAX 30 index advanced 0.3% to 4,732.14, France's CAC 40 gained 0.4% to 4,379.83 and the U.K.'s FTSE 100 inched up 0.2% to 5,223.6.

Danone shares surged 12.3% to 89.30 euro a share on speculations that Groupe Danone (DA: chart) will be acquired by PepsiCo (PEP: chart). It was reported that Pepsi will bid 115 euro a share and also that Danone planned to counter a Pepsi bid.

SABMiller (SAB: chart) added 4.2% after agreeing to acquire Colombian brewer Bavaria from Santo Domino Group.

ENERGY, METALS AND CURRENCIES MARKETS

Crude oil prices were steady Tuesday ahead of U.S. petroleum stocks data. Light, sweet crude for August delivery shed 15 cents to $57.17 a barrel on the New York Mercantile Exchange by midday in Europe. Heating oil and gasoline were almost flat at $1.6327 and $1.6440 a gallon.

On London's International Petroleum Exchange, September Brent crude oil futures were quoted at $56.97 a barrel, dropping 2 cents.

The U.S. dollar advanced versus major currencies in European trading Tuesday. The euro was quoted at $1.1991, down versus $1.2052 late Monday in New York. The greenback bought 112.65 Japanese yen, up versus 111.91, while the British pound was quoted at $1.7422, down versus $1.7480.

Gold in London was trading at $420.00 bid per troy ounce, down from $421.50 late Monday. In Zurich the bid price was $419.03, down vs. $420.90. Gold declined $1.30 in Hong Kong to finish at $420.35.

EARNINGS NEWS

Johnson & Johnson and Merrill Lynch are slated to report Tuesday. Bellwethers Intel, Motorola and Yahoo are expected to post their quarterly results after the closing bell.

Ford Motor Co. (F: chart) posted a 19% drop in second-quarter earnings due to lower-than-expected sales of the company’s core sport-utility vehicles and surging gasoline prices. The auto maker said it earned $946 million, or 47 cents a share vs. $1.17 billion, or 57 cents a share, a year earlier. Ford also backed its full-year earnings forecast at $1.00-$1.25 a share, excluding special items.