Following the substantial rebound seen over the course of the previous session, stocks are likely to move back to the downside in early trading on Wednesday. The major index futures are pointing to a notably lower open for the markets, with the Dow futures down by 139 points.
Concerns about the latest developments overseas are likely to weigh on the markets, as traders keep an eye on news out of China and Greece.
A sell-off by Chinese stocks is likely to weigh on the markets, with China's benchmark Shanghai Composite Index plummeting 5.9 percent to a four-month low despite a series of market-stabilizing measures by authorities.
Almost half of China's roughly 2,800 listed firms announced trading halts as increasing signs of deleveraging drove down stocks across the board. There were fears that a prolonged slump would cause systematic risk for the country's financial system.
Traders are also keeping an eye on the latest developments regarding the Greek debt crisis after Eurozone leaders set Sunday as the final deadline for Greece to reach an agreement on a new bailout.
At a press conference, European Council President Donald Tusk said, "The situation is really critical and unfortunately we can't exclude a black scenario if there is no agreement by Sunday."
"Until now I have avoided talking about deadlines, but tonight I have to say it loud and clear that the final deadline ends this week," he added.
Greek Prime Minister Alexis Tsipras failed to present a detailed reform blueprint at a meeting of finance ministers on Tuesday. The Greek government now has until Thursday to submit a plan.
Even with the focus on news from overseas, trading could also be impacted by the minutes of the Federal Reserve's latest monetary policy meeting.
The minutes from the June meeting, which are due to be released at 2 pm ET, could shed some light on the outlook for interest rates.
After falling sharply in early trading, stocks showed a substantial turnaround over the course of the trading session on Tuesday. The major averages bounced well off their lows for the session and into positive territory.
The Dow ended the day up 93.33 points or 0.5 percent to 17,776.91 after falling more than 200 points to its lowest intraday level in five months. The S&P 500 also climbed 12.58 points or 0.6 percent to 2,081.34, while the Nasdaq edged up 5.52 points or 0.1 percent to 4,997.46.
In overseas trading, stock markets across the Asia-Pacific region moved sharply lower along with the Chinese market. Japan's Nikkei 225 Index tumbled by 3.1 percent, while Hong Kong's Hang Seng Index plunged by 5.8 percent.
Meanwhile, the major European markets have moved notably higher on the day. While the German DAX Index has advanced by 1 percent, the U.K.'s FTSE 100 Index and the French CAC 40 Index are up by 1.2 percent and 1.4 percent, respectively.
In commodities trading, crude oil futures are slipping $0.12 to $52.21 a barrel after sliding $0.20 to $52.33 a barrel on Tuesday. Gold futures, which plunged $20.60 to $1,152.60 an ounce in the previous session, are inching up $1.40 to $1,154 an ounce.
Among currencies, the U.S. dollar is trading at 121.40 yen compared to the 122.54 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is valued at $1.1034 compared to yesterday's $1.1011.
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