7:55 pm - US stocks heading for lower open

NEW YORK (AP) - U.S. stocks were poised to open lower Wednesday asinvestors grew more cautious about the banking system and prepared to takeprofits following Tuesday's pop on Wall Street. On Tuesday, the Dow Jones industrial average shot up 420 points after theFederal Reserve cut its key interest rate by three-quarters of a percentagepoint. Investors were relieved as well to see two investment banks -- LehmanBrothers Holdings Inc. and Goldman Sachs & Co. -- report better-than-expectedquarterly profits. But Morgan Stanley's earnings are on tap Wednesday, and the rest of WallStreet is going to want to see if the investment bank is relatively healthy likeLehman or Goldman, or at risk of failure like the recently bought out BearStearns Cos. A pullback was to be expected given the magnitude of Tuesday's gain andinvestors' concerns about the many unknowns that remain not only about thefinancial sector, but the overall economy as well. Dow Jones industrial average futures fell 65, or 0.52 percent, to 12,340.Standard & Poor's 500 index futures fell 8.30, or 0.62 percent, to 1,325.70,while Nasdaq 100 index futures fell 10.0, 0.56 percent, to 1,761.0. Bond prices rose. The yield on the benchmark 10-year Treasury note, whichmove opposite its price, fell to 3.40 percent from 3.50 percent late Tuesday.The dollar was mixed against other major currencies, while gold prices fell. Light, sweet crude fell 87 cents to $108.55 per barrel in premarketelectronic trading on the New York Mercantile Exchange. Late Tuesday, Visa Inc. launched the largest initial public offering in U.S.history, selling 406 million shares at $44 each to raise $17.9 billion. Theworld's largest credit card processor -- unlike Discover Financial Services,which releases earnings on Wednesday, and American Express Co. -- is not alender, and many investors are betting that it will easily survive the falteringU.S. economy and credit climate. The Fed has slashed key rates by more than half since last summer, when themortgage crisis claimed its grip on the global credit markets. But the housingand lending industries are still hurting. The government is expected on Wednesday to loosen the capital restraints onmortgage-finance companies Fannie Mae and Freddie Mac, so they can play largerroles in the struggling housing market. The Office of Federal Housing EnterpriseOversight, which oversees the government-sponsored companies, was announcing theplan Wednesday, people familiar with the matter said Tuesday. Meanwhile, after JPMorgan Chase & Co.'s announcement Sunday that it wasbuying out the troubled investment bank Bear Stearns Cos., French bank BNPParibas SA said Wednesday it is no longer interested in making a takeover bidfor rival, Societe Generale. Societe Generale has been hurting after a roguefutures trader logged $7 billion in losses. Stock markets overseas were mixed after Wall Street's jump on Tuesday.Japan's Nikkei stock average increased 2.48 percent, while Hong Kong's Hang Sengindex rose 2.26 percent. In midday trading, Britain's FTSE 100 slipped 0.98percent, Germany's DAX index lost 0.71 percent, and France's CAC-40 declined0.58 percent. Copyright 2008 Associated Press. All rights reserved. This material may not be