Before the bell 4-19-07: Overseas selloff pulls U.S. markets down

The markets are set for a lower opening as indicated by stock futures at this time, a day after the Dow reached a new record high, but following overseas declines in the midst of earnings season.

Yesterday, investors pushed the Dow Jones Industrial Average into record territory. However, the Nasdaq composite index reflected troubles seen in the technology sector as it slipped following Yahoo!'s disappointing earnings and other companies less than stellar performance.

Today, was supposed to be a different story after eBay reported after the close yesterday results that beat analysts' estimates with profits that jumped 52%, and ahead of what most expect to be another phenomenal quarter for Google, scheduled to report after the close today.

However, overseas markets slumped. China's economy grew at a faster-than-expected pace with a GDP expansion of 11.1% in the first quarter. China's inflation rate also rose in March above the comfort zone of policy makers. While economic expansion in the world's largest market would generally be deemed positive, fear of interest rate hike in China caused Asian markets to close significantly lower and European markets to slump as well.

Economic data to be reported today is thin. The weekly jobless claims number will be reported at 8:30 a.m. The Conference Board will release at 10:00 a.m. the March leading economic indicators, which is expected to show improvement. The April Philadelphia Federal Reserve report on manufacturing activity in the region is due at noon and is also expected to show improvement.

Oil & Currency - While oil prices were somewhat lower this morning, renewed concerns with Iran could pressure them back up. The dollar was lower against the euro and the yen that strengthened in Asia as investors sought safe haven from stocks.

Earnings:
Two Dow components reported this morning: Altria (MO) - disappointed and Merck (MRK) - beat estimates.

Nokia (NOK) also reported earnings this morning, posting a profit decline of 7%. Still, results beat analysts' estimates and that while margins were indeed down, volume was strong. NOK shares are up 3.7% in pre-market trading.

Companies due to report today include Google (GOOG) - $3.30 expected EPS, Advanced Micro Devices (AMD) - (-$0.46) expected EPS, Bank of America (BAC) - beat estimates and Merrill Lynch (MER) - beat estimates.