Indications: U.S. stock futures rise as markets await Fed

By Simon Kennedy, MarketWatch

LONDON (MarketWatch) â€" U.S. stock futures pushed higher Wednesday, following President Barack Obama’s call for corporate tax cuts and a freeze on some spending. Investors also awaited a slew of corporate earnings and the Federal Reserve’s latest pronouncements on monetary policy.

Futures on the Dow Jones Industrial Average /quotes/comstock/21b!f:dj\h11 (DJH11 11,933, +11.00, +0.09%)  rose 38 points to 11,960, and S&P 500 futures /quotes/comstock/21m!f:sp\h11 (SPH11 1,291, +3.50, +0.27%)  gained 5.4 points to 1,293. Nasdaq 100 futures /quotes/comstock/21m!f:nd\h11 (NDH11 2,307, +5.75, +0.25%)  added 9 points to 2,310.25.

On Tuesday, U.S. markets overcame early disappointment over earnings to finish the session little changed. The Dow Jones Industrial Average /quotes/comstock/10w!i:dji/delayed (DJIA 11,977, -3.33, -0.03%)   ended with a decline of 3.33 points, or less than 0.1%.

State of the Union address

President Obama addresses the nation on the economy, innovation and health care during his State of the Union speech.

President Obama used his State of the Union speech late Tuesday to call for a lower corporate tax rate and a five-year freeze on domestic discretionary spending â€" a move that he said will require “painful cuts” in defense and even in Medicare and Medicaid. Read more on Obama’s State of the Union speech.

The market will get Wednesday’s main economic data after the market opens. Figures on December new-home sales are due at 10 a.m. Eastern time, followed by the latest statement from the Federal Open Market Committee at 2:15 p.m. Eastern.

Markets are likely to focus on the Fed’s inflation and growth outlook, as investors watch for any indication of when interest rates will begin to rise. Read more on expectations for the Fed.

Manoj Ladwa, senior trader at ETX Capital, said the move in stock futures was due to several factors, including Obama’s comments, hopes for strong home-sales data and the broadly positive trend in fourth-quarter earnings announcements.

“We’ve seen more beats than misses, and there hasn’t been anything to really shock markets,” Ladwa said.

The dollar edged slightly lower before the Fed statement. The euro rose 0.1% to $1.3702, while the dollar slipped 0.1% against the yen to ¥82.171.

Among companies in focus Wednesday, shares of Yahoo Inc. /quotes/comstock/15*!yhoo/quotes/nls/yhoo (YHOO 16.02, -0.07, -0.44%)  fell 2.6% in premarket trading after the Internet search company late Tuesday gave a current-quarter revenue forecast that fell short of Wall Street’s expectations. Read more about Yahoo’s results, forecast.

Toyota Motor Corp.’s /quotes/comstock/13*!tm/quotes/nls/tm (TM 83.86, +0.36, +0.43%)  shares lost 1.9% in Tokyo after the auto maker said it was recalling more than 1.7 million vehicles worldwide to fix problems, including fuel-system defects. Read more on Toyota’s woes.

Among Wednesday’s slew of earnings announcements, United Technologies Corp. /quotes/comstock/13*!utx/quotes/nls/utx (UTX 81.73, +0.21, +0.26%)  reported a 12% rise in profit to $1.2 billion as sales grew 6.3%.

Aerospace giant Boeing Co. /quotes/comstock/13*!ba/quotes/nls/ba (BA 72.24, -0.49, -0.67%) posted an 8% decline in fourth-quarter net income and offered a 2011 profit forecast of $3.80 to $4 a share. Analysts polled by FactSet Research were, on average, looking for 2011 earnings of $4.59 a share. Shares of Boeing slipped 3.1% in premarket trade.

ConocoPhillips /quotes/comstock/13*!cop/quotes/nls/cop (COP 67.48, -0.62, -0.91%)  is also on tap to report results.

In international markets, European shares posted strong gains, with the U.K.’s FTSE 100 index /quotes/comstock/23i!i:ukx (UK:UKX 5,991, +72.93, +1.23%)   up 1.3% in midday trading.

Most Asian markets closed higher, though Japan’s Nikkei 225 Average /quotes/comstock/64e!i:ni225 (JP:NI225 10,402, -62.52, -0.60%)  dropped 0.6%, in part due to the decline in Toyota.

Simon Kennedy is the City correspondent for MarketWatch in London.

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