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Stocks May Regain Ground In Early Trading - U.S. Commentary

After ending the previous session firmly in the red, stocks may regain some ground in early trading on Tuesday. The major index futures are currently pointing to a modestly higher open for the markets, with the Dow futures up by 21 points.

The markets may benefit from a positive reaction to the latest batch of earnings news, although trading activity is likely to be somewhat subdued ahead of the Federal Reserve's monetary policy announcement on Wednesday.

Diversified manufacturer 3M (MMM) is likely to see early strength after the Dow component reported better than expected first quarter earnings. The company also tightened the guidance range for its full-year earnings.

AT&T (T) and United Technologies (UTX) also reported first quarter earnings that exceeded analyst estimates, although United Technologies' revenues fell short of expectations.

Shares of Texas Instruments (TXN) may also be in focus after the chip maker reported first quarter earnings that fell year-over-year but came in above expectations. The company also forecast second quarter results in line with analyst estimates.

Meanwhile, Netflix (NFLX) is likely to come under pressure after the company reported a narrower than expected first quarter loss but forecast slower subscriber growth for its U.S. video-streaming service.

Not long after the open, trading could be impacted by the release of reports on new home sales and consumer confidence.

The Commerce Department's new home sales report is expected to show a 1.6 percent in sales in March, while the Conference Board's consumer confidence report is expected to show a modest drop in confidence in April.

Stocks saw considerable weakness during trading on Monday but ended the session well off their worst levels of the day. Troubling news from overseas weighed on the markets in early trading, but selling pressure waned as they day progressed.

The major averages climbed well off their lows for the session but still closed firmly in negative territory. The Dow closed down 102.09 points or 0.8 percent to 12,927.17, the Nasdaq fell 30.00 points or 1 percent to 2,970.45 and the S&P 500 dropped 11.59 points or 0.8 percent to 1,366.94.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Tuesday. While Japan's Nikkei 225 Index fell by 0.8 percent, Hong Kong's Hang Seng Index ended the day up by 0.3 percent.

Meanwhile, the major European markets are seeing some strength but have pulled back well off their best levels. The French CAC 40 Index is up by 0.7 percent, while the U.K.'s FTSE 100 Index and the German DAX Index are up by 0.1 percent and 0.2 percent, respectively.

In commodities trading, crude oil futures are climbing $0.35 to $103.46 a barrel after declining $0.77 to $103.11 a barrel on Monday. Gold futures are advancing $10.10 to $1,642.70 an ounce. In the previous session, the precious metal fell $10.20 to $1,632.60 an ounce.

On the currency front, the U.S. dollar is trading at 81.06 yen compared to the 81.18 yen it fetched at the close of trading on Monday. Against the euro, the dollar is trading at $1.3153 compared to yesterday's $1.3156.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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