U.S. Stocks May Move Back To The Upside In Early Trading

Following the pullback 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 modestly higher open for the markets, with the S&P 500 futures up by 0.2 percent.

Stocks may look to resume the strong upward move seen last week following a brief pause in the recovery rally on Monday.

The Dow had closed higher for five consecutive sessions before Monday’s drop, while the Nasdaq had soared more than 9 percent after hitting its lowest closing level in over a year last Monday.

Wall Street may also benefit from strength in the overseas markets, which largely shrugged off Federal Reserve Chair Jerome Powell’s comments suggesting the central bank may raise interest rates more aggressively.

On the heels of Powell’s remarks, CME Group’s FedWatch Tool is currently indicating a 31.7 percent chance the Fed will raise rates by 25 basis points in May and a 68.3 percent chance of a 50 basis point rate hike.

Another quiet day on the U.S. economic front may keep some traders on the sidelines ahead of the release of reports on durable goods orders, new and pending home sales, and weekly jobless claims.

Among individual stocks, shares of Alibaba (BABA) are moving sharply higher in pre-market trading after the Chinese e-commerce giant increased its share buyback program to a record $25 billion.

Athletic apparel and footwear giant Nike (NKE) is also seeing significant pre-market strength after reporting fiscal third quarter results that beat analyst estimates on both the top and bottom lines.

Meanwhile, shares of Okta (OKTA) are likely to come under pressure after the authentication services provider said it is investigating reports of a digital breach.

Stocks fluctuated over the course of the trading day on Monday but largely maintained a negative bias throughout the session. The major averages gave back ground following the strong upward move seen on Wall Street last week.

The major averages ended the session in negative territory but off their worst levels of the day. The Dow slid 201.94 points or 0.6 percent to 34,552.99, the Nasdaq fell 55.38 points or 0.4 percent to 13,838.46 and the S&P 500 edged down 1.94 points or less than a tenth of a percent to 4,61.18.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Tuesday. Japan’s Nikkei 225 Index jumped by 1.5 percent, while Hong Kong’s Hang Seng Index spiked by 3.2 percent.

The major European markets have also moved to the upside on the day. While the German DAX Index has risen by 0.6 percent, the French CAC 40 Index is up by 0.5 percent and the U.K.’s FTSE 100 Index is up by 0.4 percent.

In commodities trading, crude oil futures are climbing $0.53 to $112.65 a barrel after soaring $7.42 to $112.12 a barrel on Monday. Meanwhile, after inching up $0.20 to $1,929.50 an ounce in the previous session, gold futures are slipping $0.70 to $1,928.80 an ounce.

On the currency front, the U.S. dollar is trading at 120.80 yen compared to the 119.47 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1030 compared to yesterday’s $1.1016.