By Peter Nurse
Investing.com - U.S. stocks are seen opening largely unchanged Tuesday, consolidating after the previous session’s powerful gains, with investors looking to Fed Chair Jerome Powell for guidance after last week’s policy shift.
At 7:05 AM ET (1205 GMT), the Dow Futures contract was down 10 points, less than 0.1%, S&P 500 Futures traded flat, and Nasdaq 100 Futures climbed 20 points, or 0.1%.
The main equity indices bounced strongly Monday, recouping some of last week’s Fed-inspired losses, with the blue-chip Dow Jones Industrial Average gaining nearly 600 points, or 1.8%, the broad-based S&P 500 rising 1.4% and the tech-heavy Nasdaq Composite 0.8%.
However, activity is likely to be limited ahead of Powell’s testimony before U.S. lawmakers in Congress, starting at 2 PM ET, as investors continue to adjust to the central bank's policy shift.
Powell is set to repeat that inflationary pressures, although more marked than previously expected, will be transitory, while expressing optimism about the outlook for the labor market.
Ahead of his appearance, investors will study the latest existing home sales data, while the Federal Reserve Bank of Philadelphia will release its non-manufacturing business data and the Federal Reserve Bank of Richmond its monthly manufacturing survey.
In corporate news, Sanderson Farms (NASDAQ:SAFM) will be in the spotlight after the Wall Street Journal reported the company, the third-biggest U.S. chicken producer by processing capacity, is exploring a sale.
Additionally, Plug Power (NASDAQ:PLUG) is due to report Tuesday, with the hydrogen fuel cell maker expected to report a loss of 8 cents a share on revenue of $72.16 million.
Crude oil prices slipped Tuesday, falling back from new highs, as traders reacted to the potential of additional supply hitting the market.
By 6:30 AM ET, U.S. crude was up 0.2% at $71.03 a barrel, after surging 2.8% on Monday, while Brent was up 0.3% at $73.11, after earlier climbing above $75 a barrel for the first time since April 2019.
The drop follows a Bloomberg report stating that Russia plans to propose an increase in crude supply at next week’s meeting of the Organization of Petroleum Exporting Countries and allies, a group known as OPEC+, to counter what they see as a shortness of supply.
Both crude benchmarks have posted strong gains of over 40% this year, as successful vaccination programs have resulted in a lot of the high energy-consuming countries reopening their economies.
The American Petroleum Institute is due later Tuesday to release its latest estimates of U.S. crude oil supply data, ahead of official numbers from the Energy Information Administration the following day. They are expected to show another hefty draw, which would be a fifth weekly decline.