Following the sell-off seen in the previous session, stocks may show a lack of direction in early trading on Tuesday. The major index futures have recently been bouncing back and forth across the unchanged line, pointing to a roughly flat open for the markets.
Traders may be reluctant to make significant moves amid uncertainty about the near-term outlook for the markets following the steep drop seen on Monday.
While some traders are likely to pick up stocks at reduced levels, worries about further downside may keep buying interest subdued.
The continued surge in oil prices also continues to weigh on investors’ minds, with NBC News reporting the U.S. could announce a ban on Russian oil imports as early as today.
Gas stations are raising prices along with the spike in oil futures, as AAA has said the average price for a gallon of gas has reached a record high of $4.173.
The national average gas price is up by nearly $0.11 a gallon from just yesterday and up more than $0.55 a gallon from a week ago.
In U.S. economic news, the Commerce Department released a report showing the U.S. trade deficit widened by more than expected in the month of January.
The Commerce Department said the trade deficit widened to $89.7 billion in January from a revised $82.0 billion in December.
Economists had expected the deficit to climb to $87.1 billion from the $80.7 billion originally reported for the previous month. With the bigger than expected increase, the trade deficit reached a new record high.
The wider trade deficit came as the value of imports jumped by 1.2 percent to $314.1 billion, while the value of exports tumbled by 1.7 percent to $224.4 billion.
Stocks moved sharply lower over the course of the trading day on Monday, extending the downward move seen to close out the previous week. The major averages all showed substantial moves to the downside on the day.
The major averages saw further downside going into the close, ending the session at their worst levels of the session. The Dow plunged 797.42 points or 2.4 percent to 32,817.38, the Nasdaq plummeted 482.48 points or 3.6 percent to 12,830.96 and the S&P 500 tumbled 127.78 points or 3 percent to 4,201.09.
With the steep drop on the day, the Nasdaq ended the session at its lowest closing level in a year, while the Dow and the S&P 500 dropped to eleven and eight-month closing lows, respectively.
In overseas trading, stock markets across the Asia-Pacific region saw continued weakness during trading on Tuesday. Japan’s Nikkei 225 Index slumped by 1.7 percent, while China’s Shanghai Composite Index plunged by 2.4 percent.
Meanwhile, the major European markets are turning in a mixed performance on the day. While the U.K.’s FTSE 100 Index has fallen by 0.5 percent, the German DAX Index is up by 0.1 percent and the French CAC 40 Index is up by 0.5 percent.
In commodities trading, crude oil futures are spiking $4.62 to $124.02 a barrel after surging $3.72 to $119.40 a barrel on Monday. Meanwhile, after jumping $29.30 to $1,995.90 an ounce in the previous session, gold futures are climbing $22.90 to $2,018.80 an ounce.
On the currency front, the U.S. dollar is trading at 115.75 yen compared to the 115.32 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0891 compared to yesterday’s $1.0854.
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