Futures Pointing To Roughly Flat Open On Wall Street

Following the extended rally seen in the previous session, 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 S&P 500 futures down by less than a tenth of a percent.

Traders may be reluctant to continue buying stocks as they take time to digest the strong upward move seen over the past several sessions.

With the surge seen over the course of Tuesday’s session, the Dow finally joined the Nasdaq and S&P 500 at the best levels in over a year.

Some traders may look to cash in on the recent strength, although optimism the Federal Reserve is nearing the end of its interest rate-hiking cycle is likely to keep any selling pressure relatively subdued.

The release of quarterly results from several big-name companies after the close of trading is also likely to keep traders on the sidelines.

IBM Corp. (IBM), Netflix (NFLX) and Tesla (TSLA) are among the companies due to report their results as earning season continues to pick up steam.

On the U.S. economic front, the Commerce Department released a report showing a sharp pullback in housing starts in the month of June.

The Commerce Department said housing starts plunged by 8.0 percent to an annual rate of 1.434 million in June after spiking by 15.7 percent to a revised rate of 1.559 million in May.

Economists had expected housing starts to plummet by 9.3 percent to a rate of 1.480 million from the 1.631 million originally reported for the previous month.

The report said building permits also tumbled by 3.7 percent to an annual rate of 1.440 million in June after surging by 5.6 percent to a revised rate of 1.496 million in May.

Building permits, an indicator of future housing demand, were expected to edge down by 0.1 percent to a rate of 1.490 million from the 1.491 million originally reported for the previous month.

Stocks moved sharply higher over the course of the trading day on Tuesday, extending the strong upward move seen over the past several sessions. With the continued advance, the major averages all reached their best closing levels in over a year.

The major averages finished the session just off their highs of the day. The Dow jumped 366.58 points or 1.1 percent to 34,951.93, the Nasdaq advanced 108.69 points or 0.8 percent to 14,353.64 and the S&P 500 climbed 32.19 points or 0.7 percent to 4,554.98.

In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Wednesday. Japan’s Nikkei 225 Index shot up by 1.2 percent, while Australia’s S&P/ASX 200 Index rose by 0.6 percent.

Most European stocks have also moved to the upside on the day. The U.K.’s FTSE 100 Index has surged by 1.5 percent and the French CAC 40 Index is up by 0.2 percent, although the German DAX Index has bucked the uptrend and dipped by 0.3 percent.

In commodities trading, crude oil futures are climbing $0.39 to $76.14 a barrel after jumping $1.60 to $75.75 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,981.40, up $0.60 compared to the previous session’s close of $1,980.80. On Tuesday, gold surged $24.40.

On the currency front, the U.S. dollar is trading at 139.56 yen compared to the 138.83 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1214 compared to yesterday’s $1.1229.

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