After ending the previous session sharply lower, stocks may 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 49 points.
Bargain hunting may contribute to early strength on Wall Street following yesterday’s sell-off, which reflected geopolitical concerns on the heels of North Korea’s latest nuclear test.
Trading activity may be somewhat subdued, however, with uncertainty about the European Central Bank’s monetary policy meeting on Thursday likely to keep some traders on the sidelines.
On the U.S. economic front, a report released by the Commerce Department showed the U.S. trade deficit came in slightly wider in the month of July.
The Commerce Department said the trade deficit widened to $43.7 billion in July from a revised $43.5 billion in June.
Economists had expected the deficit to widen to $44.6 billion from the $43.6 billion originally reported for the previous month.
Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on activity in the service sector in the month of August.
The ISM’s non-manufacturing index is expected to climb to 55.8 in August from 53.9 in July, with a reading above 50 indicating growth in the service sector.
The Federal Reserve is also due to release its Beige Book this afternoon. The Beige Book is a compilation of anecdotal evidence on economic conditions in the twelve Fed districts.
Following the strength seen last week, stocks moved sharply lower over the course of the trading session on Tuesday. With the steep drop on the day, the tech-heavy Nasdaq pulled back well off the record closing high set last Friday.
The major averages ended the day firmly in negative territory but off their lows of the session. The Dow plunged 234.25 points or 1.1 percent to 21,753.31, the Nasdaq tumbled 59.76 points or 0.9 percent to 6,375.57 and the S&P 500 slumped 18.70 points or 0.8 percent to 2,457.85.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Wednesday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while Hong Kong’s Hang Seng Index fell by 0.5 percent.
Meanwhile, the major European markets are turning in another mixed performance on the day. While the U.K.’s FTSE 100 Index is down by 0.4 percent, the French CAC 40 Index is up by 0.2 percent and the German DAX Index is up by 0.6 percent.
In commodities trading, crude oil…