SMF Notes Early Floor Talk: Modest bid ahead of big Fed day

Futures are showing a modest bid again this morning, with S&P futures +2 vs. fair value and DJ futures +36. The early bid follows a mixed performance overseas, and precedes today's highly anticipated FOMC policy decision, which will be accompanied by the first-ever Q&A session with Fed Chairman Bernanke this afternoon. Today's Fed format is as follows -- the initial policy statement will be released at 12:30 pm ET, followed by Bernanke's conference call at 2:15 pm ET. While the Fed will take center-stage today, there continues to be a heavy flow of earnings reports, which on balance, remain positive.

In overseas markets, Asian stocks were mixed overnight (Nikkei +1.4%, Hang Seng -0.5%, Shanghai Comp -0.5%), with Japanese stocks shrugging off comments from S&P, who lowered its outlook on Japan to Negative. Japan 's Nikkei actually outperformed all global indexes today, confirming that the lowered outlook is not a surprise. Australia 's CPI accelerated higher than expected, helping to push the Aussie to over the 108 handle.

In Europe , stocks are trading near their session highs at mid-day (FTSE +0.2%, DAX +0.8% CAC +0.7%). UK GDP was in-line with consensus, but the in-line reading surpassed some expectations for a miss, which helped the pound rally against the dollar. Concerns about Greece continue to intensify, with Greek debt yields hitting another record high today. Portuguese yields also hit fresh highs, while sovereign debt yields in Spain and Italy also ticked higher. In European earnings news, BCS is -4.8% on earnings, while ERIC rose ~10% on its results.

There are a number of U.S. stocks also reacting to earnings. AMZN is nearly unchanged following its results, which missed on the bottom line and beat on the top line. AMZN also issued in-line guidance. BRCM is -8.4% after reporting better than expected current quarter EPS, but issuing disappointing guidance. Other earnings movers of interest include: KEYN +9.9%, BWLD +3.8%, PNRA +1.7%, UHS +1.7%, RFMD -6.6%, MIPS -6.4%, STM -4%, APKT -2.9%. The flow of earnings continues after the close tonight, with ~120 companies due to report, including EBAY, XLNX, CTXS, SBUX, GMCR, BIDU, NVLS, AKAM, LIZ.

In non-earnings news, SVVS will be acquired by CTL in a cash and stock deal valued at $40 per share, or a total of ~$2.5 billion, plus net debt of ~$0.7 billion which will be assumed or refinanced at close. Under the terms of the transaction, Savvis stockholders will receive $30 per share in cash and $10 in shares of CenturyLink common stock. The consideration represents an 11% premium over Savvis' closing stock price as of the close of trading yesterday.

Finally, outside of earnings and the Fed, the economic calendar picks up a bit today, with Durable Orders at 8:30 ET. Crude oil inventories are due at 10:30 ET.