With traders keeping an eye on developments in Europe, stocks may show a lack of direction in early trading on Wednesday. The major index futures are currently pointing to a roughly flat open for the markets.
Traders may stay on the sidelines ahead of an upcoming summit of European leaders, although expectations regarding the summit are relatively subdued.
Ahead of the meeting, German Chancellor Angela Merkel reiterated her opposition to the idea of common eurozone bonds, saying that Europe would not share debt liability in her lifetime.
Meanwhile, traders have largely shrugged off the release of a report from the Commerce Department showing a much bigger than expected increase in U.S. durable goods orders.
The report showed that durable goods orders jumped by 1.1 percent in May following a revised 0.2 percent decrease in April. Economists had expected orders to increase by 0.4 percent.
Excluding orders for transportation equipment, durable goods orders increase by a more modest 0.4 percent in May compared to a 0.6 percent drop in the previous month.
Not long after the open, the National Association of Realtors is scheduled to release its monthly report on pending home sales. Economists expect pending home sales to climb 1.2 percent in May following a 5.5 percent drop in April.
A pending sale is one in which a contract was signed but not yet closed. Normally, it takes four to six weeks to close a contracted sale.
Among individual stocks, shares of Bristol-Myers Squibb (BMY) are likely to be in focus after the biopharmaceutical company announced that its board increased the authorization for the repurchase of common stock by $3 billion.
Homebuilder Lennar (LEN) may see early strength after reporting better than expected second quarter earnings and revenues. The company also reported a 40 percent jump in new orders.
Meanwhile, shares of O'Reilly Automotive (ORLY) are likely to come under pressure after the auto parts retailer warned of weaker than previously forecast second quarter results.
After showing a lack of direction in morning trading on Tuesday, stocks moved mostly higher over the course of the afternoon. The markets benefited from bargain hunting follow the sell-off that was seen on Monday.
The major averages gave back some ground going into the close but remained in positive territory. The Dow rose 32.01 points or 0.3 percent to 12.534.67, the Nasdaq advanced 17.90 points or 0.6 percent to 2,854.06 and the S&P 500 climbed 6.27 points or 0.5 percent to 1,319.99.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan's Nikkei 225 Index advanced by 0.8 percent, while Hong Kong's Hang Seng Index surged up by 1 percent.
The major European markets have also shown notable moves to the upside on the day. The U.K.'s FTSE 100 Index is up by 0.7 percent, the French CAC 40 Index is up by 0.6 percent, and the German DAX Index is up by 0.5 percent.
In commodities trading, crude oil futures are climbing $0.47 to $79.83 a barrel after edging up $0.15 to $79.36 a barrel on Tuesday. An ounce of gold is valued at $1,566.30, down $8.60 from the previous session's close of $1,574.90. On Tuesday, gold fell $13.50.
Among currencies, the U.S. dollar is trading at 79.69 yen compared to the 79.52 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.2472 compared to yesterday's $1.2492.
by RTT Staff Writer
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