U.S. Stocks May Regain Ground In Early Trading
Stocks may move to the upside in early trading on Wednesday, regaining ground following the steep drop seen in the previous session. The major index futures are currently pointing to a modestly higher open, with the S&P 500 futures up by 0.2 percent.
Traders may look to pick up stocks at relatively reduced levels on the heels of the sell-off seen during trading on Tuesday.
The sharp decline, which partly reflected ongoing concerns about the outlook for interest rates, dragged the Dow and the S&P 500 down to their lowest closing levels in a month.
Nonetheless, overall trading may be somewhat subdued, as traders await the release of the minutes of the latest Federal Reserve meeting this afternoon.
The minutes may shed additional light on the outlook for interest rates amid worries the Fed will raise rates higher than currently anticipated.
Ahead of the minutes, CME Group’s FedWatch Tool is indicating a 79.0 percent chance the Fed will raise rates by 25 basis points next month and a 21.0 percent chance of a 50 basis point rate hike.
Following the mixed performance seen last Friday, stocks moved sharply lower over the course of the trading session on Tuesday. With the steep drop on the day, the Dow and the S&P 500 ended the session at their lowest closing levels in a month.
The major averages saw further downside going into the close, ending the session at their worst levels of the day. The Dow tumbled 697.10 points or 2.1 percent to 33,129.59, the Nasdaq plunged 294.97 points or 2.5 percent to 11,492.30 and the S&P 500 dove 81.75 points or 2 percent to 3,997.34.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index slumped by 1.3 percent, while China’s Shanghai Composite Index fell by 0.5 percent.
The major European markets have also moved to the downside on the day. While the U.K.’s FTSE 100 Index has slid by 0.8 percent, the French CAC 40 Index and the German DAX Index are down by 0.3 percent and 0.2 percent, respectively.
In commodities trading, crude oil futures are falling $0.51 to $75.85 a barrel after slipping $0.19 to $76.36 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,848.10, up $5.60 compared to the previous session’s close of $1,842.50. On Tuesday, gold dipped $7.70.
On the currency front, the U.S. dollar is trading at 134.57 yen compared to the 135.01 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0645 compared to yesterday’s $1.0648.
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