Wall Street set to rise as earnings beat low expectations

By Tanya Agrawal

REUTERS - U.S. stocks were set to advance at the open on Wednesday as profits beat lowered Wall Street expectations and as investors brace for the impact of a strong dollar on results.

Bank of America's, shares were down 0.5 percent at $15.74. The No. 2 U.S. bank by assets posted a first-quarter profit, narrowly beating analysts' estimates, as legal costs fell steeply and the bank earned more from mortgage lending and investment and brokerage services.

On Tuesday, both JPMorgan Chase and Wells Fargo reported better-than-expected results. Citigroup and Goldman Sachs are scheduled to post results on Thursday.

Intel, which reported results after the bell on Tuesday, was up 3.1 percent at $32.48 in premarket trading. The chipmaker forecast revenue broadly in line with Wall Street's expectations and signaled a hefty cut in capital expenditures this year.

Concerns have been growing that this earnings season will be weak due to lower oil prices, a strong U.S. dollar, and poor weather in the eastern United States in recent months.

"We are paying close attention on what effect the dollar has and we believe that those stocks that fail to meet expectations are likely to be sold off aggressively," said Gordon Charlop, a managing director at Rosenblatt Securities in New York.

Delta Air Lines' first-quarter profit topped analysts' expectations as cheap fuel continued to help its bottom line. Its shares climbed 2.4 percent to $44.10 before the opening bell.

Charles Schwab will report results later on Wednesday with video streaming company Netflix Inc reporting after the close of markets.

S&P 500 e-mini futures were up 5.5 points and fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract, indicated a modestly higher open. Dow Jones industrial average e-mini futures rose 57 points and Nasdaq 100 e-mini futures gained 10 points.

Google Inc's shares were up 0.3 percent at $538.29 in premarket trading after the U.S. search engine giant said it strongly disagreed with the European Commission, which accused it of distorting Internet searches in its favor and launched an antitrust probe into its mobile operating system Android.

Data released on Wednesday showed applications for U.S. home mortgages fell last week as interest rates edged up, while manufacturing activity growth in New York State unexpectedly contracted in April, weakening for a third straight month

(Editing by Chizu Nomiyama and Nick Zieminski)