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Stocks May See Further Upside In Early Trading - U.S. Commentary

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After ending the previous session moderately higher, stocks are likely to see some further upside in early trading on Tuesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 97 points.

The markets may benefit from recent upward momentum, which has lifted the Nasdaq and the S&P 500 to their best levels in over five months.

Optimism about U.S.-China trade talks has contributed to the buying interest on Wall Street along with indications the U.S. economy is holding up relatively well amid a global slowdown.

Trading activity may remain somewhat subdued, however, as the Federal Reserve's upcoming monetary policy decision is likely to keep some traders on the sidelines.

The Fed is widely expected to leave interest rates unchanged on Wednesday, although traders are likely to keep a close eye on the accompanying statement for clues about the outlook for rates.

The central bank's economic projections and Fed Chairman Jerome Powell's subsequent press conference are also likely to be in focus.

Just after the start of trading, the Commerce Department is scheduled to release its report on factory orders in the month of January. Factory orders are expected to rise by 0.3 percent in January after inching up by 0.1 percent in December.

Stocks fluctuated over the course of the trading day on Monday but maintained a positive bias throughout much of the session. The Nasdaq and the S&P 500 eventually ended the session at their best closing levels in over five months.

The major averages all closed in positive territory, adding to last week's gains. The Dow rose 65.23 points or 0.3 percent to 25,914.10, the Nasdaq climbed 25.95 points or 0.3 percent to 7,714.48 and the S&P 500 advanced 10.46 points or 0.4 percent to 2,832.94.

In overseas trading, most stock markets across the Asia-Pacific region moved modestly lower during trading on Tuesday. Japan's Nikkei 2225 Index edged down by 0.1 percent, while China's Shanghai Composite Index dipped by 0.2 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the German DAX Index has jumped by 1.1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are up by 0.6 percent and 0.5 percent, respectively.

In commodities trading, crude oil futures are rising $0.28 to $59.37 barrel after climbing $0.57 to $59.09 a barrel on Monday. Meanwhile, after slipping $1.40 to $1,301.50 ounce in the previous session, gold futures are advancing $7.50 to $1,309 an ounce.

On the currency front, the U.S. dollar is trading at 111.37 yen compared to the 111.43 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1352 compared to yesterday's $1.1337.

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