Modupe Gbadeyanka
By Investors Hub
The major U.S. index futures are pointing to a higher opening on Wednesday, with the major averages likely to move to the upside after ending the previous session.
Early buying interest may be generated in reaction to a report from the Commerce Department showing an unexpected increase in durable goods orders in the month of January.
Trading activity may be somewhat subdued, however, as traders keep a close eye developments in the U.K. regarding Brexit.
Following the rally seen on Monday, the major averages moved in opposite directions during trading on Tuesday. While the Dow pulled back, the broader Nasdaq and S&P 500 extended Monday?s strong upward move.
The major averages eventually ended the session mixed. The Dow fell 96.22 points or 0.4 percent to 25,554.66, while the Nasdaq climbed 32.97 points or 0.4 percent to 7,591.03 and the S&P 500 rose 8.22 points or 0.3 percent to 2,791.52.
The loss posted by the Dow was largely due to a continued decline by Boeing (BA), with the aerospace giant tumbling by 6.2 percent after slumping by 5.3 percent on Monday.
The continued drop by Boeing came after the European Union, China, the U.K. and other countries grounded the company’s 737 MAX jets following the second crash in less than 6 months.
Meanwhile, the broader markets benefited from the release of tame inflation data, which suggests the Federal Reserve will continue to refrain from raising interest rates in the near future.
After reporting no change in consumer prices over the past few months, the Labor Department released a report showing a modest increase in consumer prices in the month of February.
The Labor Department said its consumer price index rose by 0.2 percent in February after coming in unchanged for three straight months. The uptick in consumer prices matched economist estimates.
Excluding food and energy prices, core consumer prices inched up by 0.1 percent in February after rising by 0.2 percent in January. Economists had expected another 0.2 percent increase in prices.
The report also said the annual rate of consume price growth slowed to 1.5 percent in February from 1.6 percent in November, while the annual rate of core consumer price growth edged down to 2.1 percent from 2.2 percent.
With consumer price growth slowing, Paul Ashworth, Chief U.S. Economist at Capital Economics, said, “The Fed would appear to be justified in supporting the real economy by being patient and leaving interest rates on hold for a potentially extended period.”
Natural gas stocks showed a significant move to the upside over the course of the session, resulting in a 2.5 percent jump by the NYSE Arca Natural Gas Index.
The strength in the natural gas sector came amid an increase by the price of the commodity, with natural gas for April delivery rising $0.012 to $2.784 per million BTUs.
Considerable strength was also visible among oil service stocks, which remained firmly positive even as the price of crude oil pulled back well off its highs. Reflecting the strength in the sector, the Philadelphia Oil Service Index surged up by 2.5 percent.
Gold stocks also saw substantial strength on the day, benefiting from a rebound by the price of the precious metal.
