By Investors Hub
The major U.S. index futures are pointing to a lower opening on Wednesday, with stocks likely to move back to the downside following the rebound seen in the previous session.
A report from the Commerce Department showing an unexpected pullback in U.S. retail sales in the month of April may weigh on the markets in early trading.
Meanwhile, a separate report from the New York Federal Reserve showed an unexpected acceleration in the pace of growth in regional manufacturing activity.
Disappointing Chinese data may also generate some negative sentiment along with lingering concerns about the escalating U.S.-China trade dispute.
Following the sell-off seen on Monday, stocks showed a notable move back to the upside during the trading day on Tuesday. With the rebound, the Dow bounced off its lowest closing level in three months.
The major averages gave back ground going into the close but remained firmly positive. The Dow advanced 207.06 points or 0.8 percent to 25,532.05, the Nasdaq jumped 87.47 points or 1.1 percent to 7,734.49 and the S&P 500 climbed 22.54 points or 0.8 percent to 2,834.41.
Bargain hunting contributed to the rebound on Wall Street, with traders picking up stocks at reduced levels following the steep drop seen in Monday.
The markets also benefited from continued optimism the U.S. and China will eventually reach a trade deal despite the retaliatory tariffs announced by China.
President Donald Trump has continued to express confidence the Chinese will yield to U.S. demands, claiming a trade agreement was 95 percent complete before China reneged.
Trump has repeatedly argued that the U.S. is in a stronger position than China in the negotiations, citing the recent strength of the U.S. economy.
“If you looked at the first quarter ? which is always, historically, the worst quarter ? we were at 3.2 percent. People were very surprised,” Trump told reporters on Monday.
“Well, a lot of that was the tariffs that we were taking in from China,” he added. “So we’re in a very good position and I think it’s only going to get better.”
Trump also indicated that he would be meeting with Chinese President Xi Jinping at the G20 Summit in Japan late next month.
“We have a very good relationship. Maybe something will happen,” Trump said. “But we’re going to be meeting, as you know, at the G20 in Japan. And that will be, I think, probably, a very fruitful meeting.”
Oil service stocks moved sharply higher over the course of the trading session, driving the Philadelphia Oil Service Index up by 3.1 percent. The index ended the previous session at its lowest closing level in over four months.
The rebound by oil service stocks came as the price of crude oil for June delivery increased on news of a drone attack on two oil pumping stations in Saudi Arabia.
Bargain hunting also contributed to considerable strength among semiconductor stocks, with the Philadelphia Semiconductor Index surging up by 2.4 percent after plunging by 4.7 percent on Monday.
Substantial strength was also visible among natural gas stocks, as reflected by the 2.2 percent jump by the NYSE Arca Natural Gas Index. An increase by the price of natural gas is contributing to the strength in the sector.
Semiconductor stocks are also seeing considerable strength after turning in some of the market’s worst performances on Monday, with the Philadelphia Semiconductor Index surging up by 2.2 percent.
Tobacco, steel, biotechnology and software stocks also saw notable strength on the day, moving higher along with most of the other major sectors.
Adedapo Adesanya