Following the sell-off seen in the previous session, stocks may move back to the upside in early trading on Tuesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 163 points.
Traders may look to pick up stocks at relatively reduced levels after the sharp drop seen on Monday dragged the major averages down to their lowest levels in almost a month.
A positive reaction to the latest earnings news may also contribute to initial strength on Wall Street, with tech giant IBM Corp. (IBM) moving notably higher in pre-market trading after reporting better than expected second quarter results.
Travelers (TRV) and Halliburton (HAL) are also likely to move to the upside after reporting second quarter earnings that exceeded analyst estimates.
Buying interest may be somewhat subdued, however, as concerns about a surge in new coronavirus cases continue to weigh on the markets.
On the economic front, the Commerce Department released a report showing a substantial increase in new residential construction in the month of June.
The Commerce Department said housing starts spiked by 6.3 percent to an annual rate of 1.643 million in June after jumping by 2.1 percent to a revised rate of 1.546 million in May.
Economists had expected housing starts to increase by 1.1 percent to a rate of 1.590 million from the 1.572 million originally reported for the previous month.
Meanwhile, the report showed building permits tumbled by 5.1 percent to an annual rate of 1.598 million in June after slumping by 2.9 percent to a revised rate of 1.683 million in May.
Building permits, an indicator of future housing demand, had been expected to climb by 1.1 percent to a rate of 1.700 million from the 1.681 million originally reported for the previous month.
Stocks moved sharply lower during trading on Monday, extending the pullback seen over the course of last Friday’s session. With the steep drop on the day, the major averages ended the session at their lowest closing levels in almost a month.
The major averages regained some ground going into the close but remained firmly negative. The Dow plunged 725.81 points or 2.1 percent to 33,962.04, the Nasdaq slumped 152.25 points or 1.1 percent to 14,274.98 and the S&P 500 tumbled 68.67 points or 1.6 percent to 4,258.49.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index slid by 1 percent, while China’s Shanghai Composite Index edged down by 0.1 percent.
Meanwhile, the major European markets have rebounded after ending the previous session sharply lower. While the French CAC 40 Index has advanced by 0.7 percent, the U.K.’s FTSE Index is up by 0.4 percent and the German DAX Index is up by 0.2 percent.
In commodities trading, crude oil futures are edging down $0.05 to $66.37 a barrel after plunging $5.39 to $66.42 a barrel on Monday. Meanwhile, after falling $5.80 to $1,809.20 an ounce in the previous session, gold futures are climbing $13.60 to $1,822.80 an ounce.
On the currency front, the U.S. dollar is trading at 109.52 yen compared to the 109.46 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1770 compared to yesterday’s $1.1800.
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