Stocks May Move Back To The Upside In Early Trading - U.S. Commentary

By RTT News, 

( - Following the notable pullback seen over the course of the two previous sessions, stocks may move back to the upside in early trading on Wednesday. The major index futures are currently pointing to a modestly higher open for the markets, with the Dow futures up by 19 points.

Early buying interest may be generated by a positive reaction to quarterly results from Alcoa ( AA ), with the aluminum giant advancing by 2.6 percent in pre-market trading.

After the close of trading on Tuesday, Alcoa reported second quarter net income compared to a year-ago loss. The company also reported adjusted earnings and revenues that exceeded estimates and reaffirmed its forecast for global aluminum demand growth.

While Alcoa was dropped from the list of Dow components last year, the release of quarterly results from the company is still seen as the unofficial start of earnings season.

The reporting season will really start to pick up next week, with Citigroup ( C ), Goldman Sachs (GS), JP Morgan (JPM), Intel (INTC), Bank of America (BAC), IBM (IBM), Morgan Stanley (MS), and General Electric (GE) among the slew of big-name companies due to report their quarterly results.

The earnings news from Alcoa may help to drive early trading, but traders are likely to eventually turn their attention to the release of the minutes of the latest Federal Reserve meeting.

The minutes of the Fed's June meeting, which are scheduled to be released at 2 pm ET, could shed some additional light on the outlook for monetary policy.

However, some analysts have suggested taking the Fed minutes with a grain of salt, as the meeting took place before last week's much better than expected jobs data.

Among individual stocks, shares of American Airlines ( AAL ) are moving sharply higher in pre-market trading after the airline raised its forecast for second quarter growth in passenger revenue per available seat mile, a key revenue measure.

Mexican telecom giant America Movil ( AMX ) could also see early strength amid news the company is prepared to divest assets to avoid the impact of new regulations.

On the other hand, shares of Container Store Group ( TCS ) are likely to come under pressure after the storage and organization products retailer reported a wider than expected first quarter loss and provided disappointing guidance.

After moving mostly lower during trading on Monday, stocks saw further downside over the course of the trading day on Tuesday. With the losses on the day, the Dow and the S&P 500 pulled back further off last week's record highs.

The major averages all closed firmly in the red, although the tech-heavy Nasdaq underperformed its counterparts. While the Nasdaq plummeted 60.07 points or 1.4 percent to 4,391.46, the Dow dropped 117.59 points or 0.7 percent to 16,906.62 and the S&P 500 slid 13.94 points or 0.7 percent to 1,963.71.

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This article appears in: News Headlines

Referenced Stocks: AA , AAL , AMX , C , TCS

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