U.S. stocks are poised for a higher start Wednesday, following Spain's announcement of drastic cuts as it aims for fiscal responsibility.
Dow Jones industrial average, S&P 500 and Nasdaq futures were higher Wednesday morning. Stock futures indicate the possible direction of the markets when they open at 9:30 a.m. ET.
Investors began the day welcoming a renewed Spanish focus on fixing its debt dilemma. In a speech to parliament, Prime Minister Mariano Rajoy said the country would cut €65 billion ($79.6 billion) in less than three years by reducing government and raising taxes. Meeting budget deficit reduction targets would require austerity and more efficiency, he said.
"We will significantly reduce the number of public institutions," Rajoy promised.
The speech came after European finance ministers agreed late Monday to offer the struggling country an initial €30 billion by the end of the month to help bail out its troubled banks. Yields for Spanish 10-year bonds, which have hovered around the perilous 7% level in recent weeks, fell to 6.67% Wednesday.
Ryan Larson, head of equity trading at U.S. RBC Global Asset Management in Chicago, said the speech gave a boost to U.S. futures.
"It's sending the message to the market that they're willing to address the problems more immediately," he said.
Meanwhile on the domestic front, the Federal Reserve will release the minutes of its latest policy-making meeting Wednesday afternoon, possibly offering clues about whether any further central bank intervention is looming.
Investors have been watching for any signs of another round of quantitative easing -- this time called QE3. While that will likely shake up markets, it won't do much for very long, according to Kim Caughey Forrest, senior equity analyst at Fort Pitt Capital Group in Pittsburgh.
"It doesn't fix a darn thing," she said. "It's a shot of energy, a Red Bull for the market. It doesn't last long, but it feels great when it's happening and makes asset prices rise. It's the U.S.'s way of kicking the can down the road."
U.S. stocks closed lower Tuesday, as worries about corporate earnings falling short of expectations unnerved investors. No major corporate results are expected Wednesday, though reports are due later in the week from JPMorgan Chase and Wells Fargo.
World markets: European stocks were mixed in midday trading. Britain's FTSE 100 slid 0.1% and France's CAC 40 fell 0.3%, while the DAX in Germany gained 0.5%.
Asian markets ended mixed. The Shanghai Composite added 0.5% and the Hang Seng in Hong Kong edged higher by 0.1%, while Japan's Nikkei fell 0.1%.
Economy: The U.S. trade deficit stood $48.7 billion in May, coming in just slightly below expectations. It dropped from $50.1 billion the prior month.
The next report out Wednesday morning will be wholesale inventories at 10 a.m. ET. A survey of analysts by Briefing.com expect wholesale inventories for May increased by 0.3%.
The Federal Reserve will release its minutes at 2 p.m. ET.
Companies: When JPMorgan reports earnings Friday, the bank is expected to show how much it has lost so far due to the risk taking of its London Whale trader. The report could generate even more interest if, as The Wall Street Journal reported Wednesday, the bank will make an example of executives behind the errors and reclaim stock from them worth millions.
Currencies and commodities: The dollar fell against the euro, British pound and Japanese yen.
Oil for August delivery rose 96 cents to $84.87 a barrel.
Gold futures for August delivery fell $2.90 to $1,576.90 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, pushing the yield up to 1.52% from 1.50% late Tuesday.