The major U.S. index futures are pointing to a lower opening on Tuesday following the modest strength seen in the previous session. Profit taking may contribute to early weakness on Wall Street after the Dow climbed to a new record closing high for the ninth consecutive session on Monday.
However, overall trading activity may remain somewhat subdued amid another quiet day on the U.S. economic front. Traders may be reluctant to make significant moves ahead of the release of reports on labor productivity and costs and producer and consumer price inflation in the coming days.
Remarks by Federal Reserve officials may also attract attention later this week, as traders look for clues about the outlook for monetary policy.
In a speech on Monday, St. Louis Fed President James Bullard said the current level of interest rates is likely to remain appropriate over the near term amid subdued inflation.
Stocks moved modestly higher during trading on Monday, adding to the slim gains posted last Friday. With the upward move on the day, the Dow climbed to a new record closing high for the ninth consecutive session.
The major averages all closed in positive territory, although the tech-heavy Nasdaq outperformed its counterparts. While the Nasdaq climbed 32.21 points or 0.5 percent to 6,383.77, the Dow edged up 25.61 points or 0.1 percent to 22,118.42 and the S&P 500 rose 4.08 points or 0.2 percent to 2,480.91.
The modest strength on Wall Street partly reflected ongoing positive sentiment following last Friday's upbeat monthly jobs report.
A Labor Department report said non-farm payroll employment surged up by 209,000 jobs in July after spiking by an upwardly revised 231,000 jobs in June. Economists had expected employment to climb by 183,000 jobs.
The stronger than expected job growth added to optimism about the economy but also raised concerns about the outlook for interest rates.
However, a lack of major U.S. economic data kept some traders on the sidelines ahead of reports on producer and consumer price inflation and labor productivity and costs in the coming days.
Remarks by several Federal Reserve officials may also attract attention this week, as traders look for clues about the future of monetary policy.
Traders may also have been reluctant to make significant moves amid geopolitical uncertainty after the United Nations imposed stringent new sanctions on North Korea for its escalating nuclear and missile programs.
Steel stocks showed a substantial move to the upside, driving the NYSE Arca Steel Index up by 2.4 percent. With the gain, the index reached its best closing level in well over four months.
Brazil's CSN (SID), Mechel (MT), and Gerdau (GGB) turned in some of the steel sector's best performances on the day.
Considerable strength also emerged among semiconductor stocks, as reflected by the 1.7 percent gain posted by the Philadelphia Semiconductor Index. ON Semiconductor (ON) led the sector higher after reporting a spike in second quarter profits.
On the other hand, oil service stocks moved sharply lower over the course of the session, dragging the Philadelphia Oil Service Index down by 2.7 percent. The weakness among oil service stocks came amid a modest decrease by the price of crude oil.
Natural gas stocks also came under pressure on the day, resulting in a 1.8 percent drop by the NYSE Arca Natural Gas Index. The index fell to its lowest closing level in well over a month.
Commodity, Currency Markets
Crude oil futures are inching up $0.08 to $49.47 a barrel after slipping $0.19 to $49.39 a barrel on Monday. Meanwhile, after edging up $0.10 to $1,264.70 an ounce in the previous session, gold futures are climbing $4.80 to $1,269.50 an ounce.
On the currency front, the U.S. dollar is trading at 110.27 yen compared to the 110.75 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1815 compared to yesterday's $1.1795.
Asia
Asian stocks ended mixed on Tuesday as a stronger yen hit exporters in Japan, oil prices slipped on concerns about major producers' wavering commitment to output caps and China reported disappointing trade data.
Chinese shares ended little changed as the export and import figures fell short of analysts' expectations. The benchmark Shanghai Composite Index inched up 3.49 points or 0.1 percent to 3,282.95. Hong Kong's Hang Seng Index climbed 164.55 points or 0.6 percent to 27,854.91.
Chinese exports climbed 7.2 percent year-over-year in July, well below the 11.0 percent spike economists had expected. Imports rose 11.0 percent from a year ago, much slower than the expected growth of 18.0 percent.
Separately, central bank data showed China's foreign exchange reserves increased by $24 billion to a 9-month high of $3.08 trillion in July, as tight regulation contained the outflow.
Japanese shares fell as the U.S. dollar changed hands in the upper 110-yen range. The Nikkei 225 Index slipped 59.88 points or 0.3 percent to 19,996.01, while the broader Topix index closed 0.2 percent lower at 1,635.32.
Exporters Panasonic and Mazda Motor ended down over 1 percent each. Pioneer Corp shares plunged 6 percent after the car electronics maker reported a loss for the first quarter and lowered its full-year sales outlook.
Meanwhile, Japan Steel Works shares soared 20 percent after the company raised its operating profit outlook for the year ending March 2018. GS Yuasa Corp jumped 8.7 percent on a Nikkei report that the company is working on a lithium-ion battery that would be ready for mass production around 2020.
On the economic front, Japan's current account surplus expanded in the January-June period to the highest level since 2007, supported by returns on foreign investments and a positive trade balance, official data showed.
Australian shares erased early gains to end notably lower, dragged down by banking and energy stocks. Markets showed little reaction to a survey showing business conditions at highest levels in nine years.
The benchmark S&P/ASX 200 Index dropped 29.80 points or 0.5 percent to 5,743.80, and the broader All Ordinaries Index shed 28.80 points or 0.5 percent to finish at 5,795.70.
Commonwealth Bank, which is facing a new lawsuit over climate risks, fell 1.1 percent, while ANZ shed 0.4 percent and Westpac edged down 0.1 percent.
Santos, Oil Search and Beach Energy lost 1-2 percent as oil extended overnight losses ahead of API inventory.
Infrastructure company Transurban declined 1.8 percent after its distribution guidance for the year ahead fell short of market expectations. Similarly, building materials supplier James Hardie slumped 5.8 percent after issuing a cautious outlook.
Seoul stocks closed lower on institutional selling. The benchmark Kospi ended down 4.02 points or 0.2 percent at 2,394.73, dragged down by automakers and chemical companies. Tech shares advanced, with chipmaker SK Hynix climbing 3.4 percent.
Europe
European stocks were sluggish on Tuesday as data out of China, Germany and France disappointed investors and the euro extended gains against the dollar in lackluster trading. Regional earnings have also proved to be a mixed bag.
While the German DAX Index has fallen by 0.3 percent, the French CAC 40 Index is down by 0.2 percent and the U.K.'s FTSE 100 Index is down by 0.1 percent.
German exports declined 2.8 percent in June from May, when they climbed 1.5 percent, official data showed. Imports slid 4.5 percent, in contrast to May's 1.3 percent increase.
France's trade deficit widened to 4.66 billion euros in June from 4.43 billion euros in May, data from the customs office showed.
Danish jewelry manufacturer and retailer Pandora has plummeted after its second quarter revenue and profits missed analyst expectations.
British insurer Standard Life has also fallen after its Global Absolute Return Strategies (GARS) mandate saw 5.6 billion pounds in net outflows in the first half of the year.
InterContinental Hotels Group slid after reporting slower growth in revenue per room in the second quarter. Gaming operator Paddy Power also slumped after reporting disappointing results.
On the positive side, Finnish tire maker Nokian has jumped after reporting better than expected quarterly earnings on higher Russian demand and a stronger ruble.
Aegon shares have also advanced on news the Dutch insurer has agreed to sell Unirobe Meeùs Groep, an independent financial advisory group, to Aon Groep Nederland for 295 million euros.
Mail and logistics group Deutsche Post DHL Group has rallied as the German company confirmed its full year outlook after reporting higher profit in its second quarter with good growth in revenues.
Uniper shares have also climbed after the conventional-energy company raised the lower end of its outlook for fiscal 2017 adjusted EBIT and increased its guidance for full-year dividend growth.
U.S. Economic Reports
At 10 am ET, the Labor Department is scheduled to release its report on job openings in the month of June. Job openings are expected to drop to 5.600 million in June from 5.666 million in May.
The Treasury Department is due to announce the results of its auction of $24 billion worth of three-year notes at 1 pm ET.
Stocks In Focus
Shares of Depomed (DEPO) are moving sharply lower in pre-market trading after the drug maker reported second quarter adjusted earnings that matched estimates but lowered its full-year guidance.
Car rental company Avis Budget (CAR) may also see early weakness after reporting weaker than expected second quarter results and forecasting full-year earnings below analyst estimates.
Shares of Tenet Healthcare (THC) could also move to the downside after the hospital operator reported a wider than expected second quarter loss and cut its full-year guidance.
On the other hand, shares of FibroGen (FGEN) may spike higher after the biopharmaceutical company announced positive results from a Phase 2 study of pamrevlumab in idiopathic pulmonary fibrosis.
Cloud communications company Twilio (TWLO) is also seeing notable pre-market strength after reporting second quarter results that beat estimates on both the top and bottom lines.
CVS Health (CVS), CBS (CBS), and Time (TIME) may also be in focus after reporting better than expected second quarter results.
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