U.S. Stocks May Move Back To The Upside In Early Trading
Following the pullback seen in the previous session, stocks are likely to move back to the upside in early trading on Wednesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 203 points.
The markets may once again benefit from recent upward momentum, which has helped the major averages recover after tumbling to their lowest levels in over a year.
Positive sentiment may also be generated in reaction to news that Shanghai has formally ended its two-month citywide lockdown.
Overall trading activity may be somewhat subdued, however, as traders look ahead to the release of the closely watched monthly jobs report on Friday.
Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on manufacturing activity in the month of May.
The ISM’s manufacturing PMI is expected to edge down to 54.5 in May from 55.4 in April, although a reading above 50 would still indicate growth in the sector.
The Commerce Department is also due to release its report on construction spending in the month of April. Construction is expected to increase by 0.5 percent.
Later in the day, the Federal Reserve is scheduled to release its Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts.
Stocks closed lower on Wall Street on Tuesday, as concerns about soaring inflation and looming policy tightening by the Federal Reserve rendered the mood bearish.
The major averages all ended on a negative note despite recovering well from an early setback. The Dow, which plunged to 32,752.34 in early trading, ended the session with a loss of 222.84 points or 0.7 percent at 32,990.12.
The S&P 500 drifted down 26.09 points or 0.6 percent to 4,132.15, while the Nasdaq, which managed to spend some time in positive territory during the session, ended down 49.74 points or 0.41 percent at 12,081.39.
The Dow posted a small gain for the month of May, while the S&P 500 ended little changed and the Nasdaq shed about 2.1 percent.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan’s Nikkei 225 Index advanced by 0.7 percent, while Hong Kong’s Hang Seng Index fell by 0.6 percent.
The major European markets have also turned mixed on the day. While the U.K.’s FTSE 100 Index is down by 0.1 percent, the French CAC 40 Index is up by 0.3 percent and the German DAX Index is up by 0.4 percent.
In commodities trading, crude oil futures are jumping $1.30 to $115.97 a barrel after slipping $0.40 to $114.67 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,827.70, down $15 compared to the previous session’s close of $1,842.70. On Tuesday, gold fell $8.60.
On the currency front, the U.S. dollar is trading at 129.49 yen compared to the 128.67 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0719 compared to yesterday’s $1.0734.
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