Indications: U.S. futures mixed amid earnings, merger news

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By Steve Goldstein, MarketWatch

LONDON (MarketWatch) -- U.S. stock futures were mixed Tuesday after a three-day break, with traders returning to a slate of earnings and merger announcements, including a recommended $19.5 billion offer for Cadbury by Kraft Foods.

S&P 500 futures dipped a half point to 1,131.80 and futures on the Dow Jones Industrial Average fell 6 points, while futures on the tech-heavy Nasdaq 100 rose 4 points to 1,866.20.

U.S. stocks finished lower last week, with the S&P 500 retreating 0.8%.

"The market is probably counting on at least some earnings leverage to become evident," said Bill Stone, chief investment strategist of PNC Wealth Management.

"Some sign of increasing revenues will likely be crucial," he said.

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Citigroup /quotes/comstock/13*!c/quotes/nls/c (C 3.41, -0.01, -0.29%) , CSX /quotes/comstock/13*!csx/quotes/nls/csx (CSX 50.04, 0.00, 0.00%) , and, after the close, International Business Machines /quotes/comstock/13*!ibm/quotes/nls/ibm (IBM 131.81, +0.03, +0.02%) headline Tuesday's set of earnings releases.

The last time Citigroup released results, its share price dropped 7.9% over five trading days, according to WhisperNumber.com.

There were a number of deals announced over the last two days, with Warren Buffett having a piece in many of them.

Buffett-held Kraft Foods /quotes/comstock/13*!kft/quotes/nls/kft (KFT 29.58, 0.00, 0.00%) improved its cash-and-stock offer for Cadbury /quotes/comstock/13*!cby/quotes/nls/cby (CBY 51.90, 0.00, 0.00%) to $19.5 billion, a bid that won the support of the U.K. chocolate producer. See story.

Buffett's Berkshire Hathaway /quotes/comstock/13*!brk.a/quotes/nls/brk.a (BRK.A 97,500, 0.00, 0.00%) also paid $1.3 billion for U.S. life insurance business from Swiss Re. And the Omaha, Nebraska-based firm is looking to increase its stake in Korean steelmaker Posco, according to a Bloomberg News report.

Outside of the Buffett sphere, Tyco International /quotes/comstock/13*!tyc/quotes/nls/tyc (TYC 37.61, +0.07, +0.19%) said it's buying Brink's Home Security Holdings /quotes/comstock/13*!cfl/quotes/nls/cfl (CFL 31.42, 0.00, 0.00%) for $2 billion in cash and stock.

Japan Airlines filed for bankruptcy protection. The SkyTeam alliance that includes Delta Air Lines /quotes/comstock/13*!dal/quotes/nls/dal (DAL 12.76, +0.02, +0.16%) and Air France-KLM is trying to get the carrier to switch from its current oneworld grouping that includes AMR Corp.'s /quotes/comstock/13*!amr/quotes/nls/amr (AMR 8.08, -0.01, -0.12%) American Airlines and British Airways.

Apple /quotes/comstock/15*!aapl/quotes/nls/aapl (AAPL 205.93, 0.00, 0.00%) started issuing invitations for an event to be held next week in which the company is widely anticipated to roll out an electronic tablet.

"We can envision commuters downloading TV shows, magazines and newspapers for their daily trek. In our view, both AT&T and Verizon are vying to carry the Tablet and both are likely to carry the device," said Peter Misek, an analyst at Canaccord Adams, in a note to clients.

AT&T /quotes/comstock/13*!t/quotes/nls/t (T 25.83, +0.04, +0.16%) late Friday introduced a new wireless price plan, just hours after Verizon Wireless also rolled out a new price plan.

The economics calendar features November Treasury inflows data and a January home builder index. Overseas, U.K. inflation accelerated at the highest rate on record in December and the Bank of Canada is due to make an interest rate decision.

The U.K. data buoyed the British pound, while the euro was weaker after worse-than-forecast German investor sentiment and continued concerns about Greece's debt situation.

Oil futures traded below $78 a barrel.

The Nikkei 225 declined 0.8% in Tokyo while the German DAX fell 0.8%.

Steve Goldstein is MarketWatch's London bureau chief.