After moving sharply lower over the course of the previous session, 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.
Bargain hunting is likely to contribute to any early strength on Wall Street after worries about the ongoing European debt crisis dragged the major averages firmly into negative territory on Monday.
Nonetheless, the lingering concerns about the financial situation in Europe are likely to keep buying interest relatively subdued.
Reflecting the continued troubles in Europe, ratings agency Moody's downgraded the long-term debt and deposit ratings for 28 Spanish banks. The downgrades came after Spain formally asked for a bailout to shore up its ailing banking sector.
Moody's noted that the downgrades follow the weakening of the Spanish government's creditworthiness and also reflect the lowering of most of the banks' standalone credit assessments.
Trading could also be impacted by the release of Standard & Poor's report on home prices in major U.S. metropolitan areas in the month of April. Economists expect the report to show a 0.4 percent monthly increase in prices.
The Conference Board is also scheduled to release its monthly report on consumer confidence not long after the open. The consumer confidence index is expected to drop to 63.5 in June from 64.9 in May.
In corporate news, shares of News Corp. (NWS) could be in focus after the Wall Street Journal reported that the media giant is considering splitting its publishing and entertainment businesses into two companies. News Corp. is the parent of the Wall Street Journal.
Seagate Technology (STX) may also attract some attention after Standard & Poor's announced that the disk drive maker will replace Progress Energy (PGN) in the S&P 500 index after the close of trading on Friday. Progress Energy is being acquired by Duke Energy (DUK).
Additionally, shares of Apollo Group (APOL) could see early strength after the education company reported better than expected third quarter earnings. The company also forecast full year revenues in line with analyst estimates.
Stocks moved sharply lower during trading on Monday after seeing considerable volatility last week. Lingering concerns about the ongoing European debt crisis weighed on the markets amid worries about the impact on the global economy.
After showing a steep drop in early trading, the major averages remained stuck firmly in the red throughout the session. The Dow fell 138.12 points or 1.1 percent to 12,502.66, the Nasdaq tumbled 56.26 points or 2 percent to 2,836.16 and the S&P 500 slid 21.30 points or 1.6 percent to 1,313.72.
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 0.5 percent.
The major European markets have also turned mixed over the course of the trading day. The U.K.'s FTSE 100 Index is up by 0.2 percent, while the German DAX Index and the French CAC 40 Index are both down by 0.2 percent.
In commodities trading, crude oil futures are slipping $0.26 to $78.95 a barrel after sliding $0.55 to $79.21 a barrel on Monday. Gold futures are falling $9.50 to $1,578.90 an ounce. In the previous session, the precious metal rose $21.50 to $1,588.40 an ounce.
Among currencies, the U.S. dollar is trading at 79.41 yen compared to the 79.67 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.247 compared to yesterday's $1.2504.
For comments and feedback: editorial@rttnews.com