U.S. Stocks May Show A Lack Of Direction Following Yesterday’s Rebound

Following the rebound seen in the previous session, stocks may show a lack of direction in early trading on Wednesday. The major index futures are currently pointing to a roughly flat open for the markets, with the Dow futures down by just 4 points.

The futures were more firmly in the red earlier in the morning amid lingering concerns about tensions between Russia and Ukraine.

While Russian claims they are pulling some troops back from the Ukrainian border contributed to the rally on Tuesday, Western leaders have subsequently said they have not verified the moves.

Cyberattacks on the websites of Ukraine’s defense ministry as well as two major Ukrainian banks have also led to worries Russia could still be poised to invade.

However, the futures have climbed back near the unchanged line after the Commerce Department released a report showing a substantial rebound in U.S. retail sales in the month of January,

The Commerce Department said retail sales soared by 3.8 percent in January after plunging by a revised 2.5 percent in December.

Economists had expected retail sales to jump by 2.0 percent compared to the 1.9 percent slump originally reported for the previous month.

Excluding a sharp increase in motor vehicle and parts sales, retail sales still spiked by 3.3 percent in January following a 2.8 percent nosedive in December. Ex-auto sales were expected to increase by 0.8 percent.

Meanwhile, the Labor Department released a separate report showing U.S. import prices increased by much more than expected in the month of January.

Overall trading may be somewhat subdued as traders look ahead to the minutes of the Federal Reserve’s latest monetary policy meeting, which may shed additional light on the outlook for interest rates.

Just before the start of trading, the Fed is scheduled to release its report on industrial production in the month of January. Industrial production is expected to rise by 0.4 percent in January after edging down by 0.1 percent in December.

The Commerce Department is also due to release its report on business inventories in the month of December shortly after the start of trading. Economists expect business inventories to surge by 2.1 percent.

Additionally, the National Association of Home Builders is scheduled to release its report on homebuilder confidence in the month of February. The housing market index is expected to come in unchanged at 83.

Stocks showed a strong move to the upside during trading on Tuesday, regaining ground following the sell-off seen in recent sessions. The major averages all moved sharply higher, with the tech-heavy Nasdaq leading the advance.

The major averages finished the session near their best levels of the day. The Dow jumped 422.67 points or 1.2 percent to 34,988.84, the Nasdaq spiked 348.84 points or 2.5 percent to 14,139.76 and the S&P 500 surged 69.40 points or 1.6 percent to 4,471.07.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index shot up by 2.2 percent, while China’s Shanghai Composite Index climbed by 0.6 percent.

Meanwhile, the major European markets are seeing modest weakness on the day. While the U.K.’s FTSE 100 Index has edged down by 0.2 percent, the French CAC 40 Index and the German DAX Index are both down by 0.1 percent.

In commodities trading, crude oil futures are jumping $1.34 to $93.41 a barrel after plummeting $3.39 to $92.07 a barrel a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,855.30, down $0.90 compared to the previous session’s close of $1,856.20. On Tuesday, gold fell $13.20.

On the currency front, the U.S. dollar is trading at 115.64 yen compared to the 115.61 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1369 compared to yesterday’s $1.1359.

Source: Read Full Article