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U.S. Stocks May Extend Rebound From Yesterday's Early Sell-Off

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Stocks may move to the upside in early trading on Wednesday, extending the rebound from the sell-off seen early in the previous session. The major index futures are currently pointing to a modestly higher open for the markets, with the Dow futures up by 24 points.

The markets may continue to benefit from easing concerns about the outlook for monetary policy following Federal Reserve Chair Jerome Powell's remarks on Tuesday.

In testimony before the Senate Banking Committee, Powell unsurprisingly reiterated that the Fed is likely to maintain its ultra-easy monetary policy for the foreseeable future.

Powell is set to appear before the House Financial Services Committee later this morning, with his prepared remarks likely to mirror those he delivered yesterday.

While Fed officials have largely been consistent in suggesting policy will remain unchanged, a recent increase in treasury yields has spooked investors.

A notable increase in the yields on ten-year notes and thirty-year bonds this morning may subsequently keep early buying interest somewhat subdued.

Shortly after the start of trading, the Commerce Department is scheduled to release its report on new home sales in the month of January.

New home sales are expected to jump by 1.5 percent to an annual rate of 855,000 in January after surging up by 1.6 percent to a rate of 842,000 in December.

After moving sharply lower early in the session, stocks showed a substantial recovery over the course of the trading day on Tuesday. The major averages climbed well off their early lows, with the Dow and the S&P 500 reaching positive territory.

The Dow plunged by more than 360 points in early trading but ended the day up 15.66 points or 0.1 percent at 31,537.35. The S&P 500 also inched up 4.87 points or 0.1 percent to 3,881.37 after tumbling by as much as 71 points.

Meanwhile, the tech-heavy Nasdaq finished the session down 67.85 points or 0.5 percent at 13,465.20 but was well off the nearly one-month intraday low set in early trading.

In overseas trading, stock markets across the Asia-Pacific region moved sharply lower during trading on Wednesday. Japan's Nikkei 225 Index tumbled by 1.6 percent, while Hong Kong's Hang Seng Index plunged by 3 percent.

Meanwhile, the major European markets have moved to the upside on the day. While the German DAX Index has advanced by 0.7 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are both up by 0.1 percent.

In commodities trading, crude oil futures are rising $0.34 to $62.01 a barrel after edging down $0.03 to $61.67 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,800, down $5.90 compared to the previous session's close of $1,805.90. On Tuesday, gold slipped $2.50.

On the currency front, the U.S. dollar is trading at 106.06 yen compared to the 105.25 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.2132 compared to yesterday's $1.2150.

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