Financials set to lift Wall Street at open

Stocks headed for a higher open on Monday, with financial shares poised to rise after Bank of America (BAC.N) posted quarterly results that buoyed hopes the worst of the credit crisis may be abating.

Adding to the positive tone was news that Roche Holding AG (ROG.VX) had proposed to buy the portion of biotech company Genentech it doesn't already own for $43.7 billion.

Shares of Bank of America, the second-largest U.S. bank, jumped more 10 percent before the bell after it became the latest major bank to exceed Wall Street estimates, suggesting the financial sector may be weathering the credit crisis.

Citigroup (C.N), Wells Fargo (WFC.N) and JPMorgan Chase & Co (JPM.N) have also topped analysts' expectations recently.

"We're seeing a pattern here with the banks where I think analysts really had low-ball forecasts, and we've seen basically every bank come out and beat the numbers," said Matt McCall, president of Penn Financial Group in Denver, Colorado.

S&P 500 futures rose 6.7 points and were above fair value, a mathematical formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract.

Dow Jones industrial average futures rose 39 points, and Nasdaq 100 futures gained 11 points.

Swiss pharmaceutical company Roche offered to buy all outstanding shares in U.S. partner Genentech Inc (DNA.N), the world's second-largest biotechnology company, to reinforce Roche's position in anti-cancer medicines.

Roche already owns 55.9 percent of Genentech, whose shares jumped 16.1 percent to $95 before the bell.

Even though Bank of America's second-quarter profit fell for a fourth straight quarter, it still topped analysts' forecasts, sending its stock to $30.50 before the bell.

Financials looked set to extend the gains from last week, with the XLF, the sector's electronic traded fund, or ETF , 2.2 percent higher before the bell.

In other banking news, the Wall Street Journal reported that Goldman Sachs' Ken Wilson, the bank's most senior financial-institutions banker, will temporarily leave the firm to advise Treasury Secretary Henry Paulson on how to resolve the country's banking crisis. The newspaper cited people familiar with the matter.

Shares of Yahoo (YHOO.O) are among stocks to watch after the Internet media company announced that investor Carl Icahn will be appointed to its board of directors. Yahoo shares were down 2.5 percent at $21.90 before the bell.

After sharp losses last week, U.S. light crude for August delivery rose $1.64 to $130.42 a barrel.

(Agencies)