U.S. Stocks May Show A Lack Of Direction In Early Trading

wallstreet july25 20oct21 lt

After trending higher over the past few sessions, 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, with the Dow futures down by just 16 points.

Traders may take a breather following the notable advance seen in recent days, which lifted the major averages to their best closing levels in a month on Tuesday.

Upbeat earnings news has helped propel stocks higher, although traders remain concerned about the outlook for inflation and the Federal Reserve scaling back stimulus.

Later in the day, the Federal Reserve is due to release its Beige Book, a compilation of anecdotal evidence on economic conditions in each of the twelve Fed districts.

The Beige Book may provide further clues about the Fed's plans for monetary policy, with the central bank widely expected to begin tapering its asset purchases as early as next month.

U.S. stocks closed on a firm note on Tuesday, with the major averages reaching their best closing levels in a month, as investors reacted positively to some upbeat earnings news from big-name companies. Worries about slowing growth amid supply chain bottlenecks did weigh a bit and limit the gains.

The major averages all ended with solid gains. The Dow ended higher by 198.70 points or 0.6 percent at 35,457.31. The S&P 500 surged up 33.17 points or 0.7 percent to settle at 4,519.63, while the tech-laden Nasdaq advanced 107.28 points or 0.7 percent to 15,129.09.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index inched up by 0.1 percent, while China's Shanghai Composite Index edged down by 0.2 percent.

The major European markets are also showing a lack of direction on the day. While the U.K.'s FTSE 100 Index is just above the unchanged line, the French CAC 40 Index and the German DAX Index are both up by 0.1 percent.

In commodities trading, crude oil futures are slumping $0.85 to $82.11 a barrel after rising $0.52 to $82.96 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,783.40, up $12.90 compared to the previous session's close of $1,770.50. On Tuesday, gold rose $4.80.

On the currency front, the U.S. dollar is trading at 114.20 yen compared to the 114.38 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1636 compared to yesterday's $1.1633.

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