By Peter Nurse
Investing.com - U.S. stocks are seen posting small gains at the open, recovering from the previous session’s tech-led selloff, helped by Facebook (NASDAQ:FB) bouncing after its prolonged outage.
At 7:05 AM ET (1105 GMT), the Dow Futures contract was up 115 points, or 0.4%, S&P 500 Futures traded 15 points, or 0.4%, higher, while Nasdaq 100 Futures climbed 60 points, or 0.4%.
The major indices sold off sharply on Monday, with rising U.S. Treasury yields prompting the tech heavyweights Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL), Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) to all fall at least 2%, dragging the Nasdaq Composite 2.1% lower. The blue-chip Dow Jones Industrial Average shed more than 300 points, or 0.9%, while the broad-based S&P 500 lost 1.3%.
Helping the tone has been the hope that the economy will grow more strongly as the Delta-variant Covid-19 wave ebbs. Global cases hit their lowest in nearly two months on Monday, according to Johns Hopkins data, while Merck (NYSE:MRK) has received optimistic results for its oral treatment and Johnson & Johnson (NYSE:JNJ) has filed for authorisation for its vaccine booster.
That said, investors remain cautious after President Joe Biden warned that the U.S. is at risk of breaching the limit on its debt as a potential default draws nearer and as the U.S. Federal Reserve gets closer to paring back its massive bond-buying program.
In corporate news, PepsiCo (NASDAQ:PEP) will be in the spotlight after the soft drinks giant raised its full-year revenue forecast, as the easing of pandemic restrictions boosts demand at theaters and restaurants.
Facebook (NASDAQ:FB) stock traded higher premarket, rebounding from Monday’s near 5% drop after a six-hour global outage, while Tesla (NASDAQ:TSLA) faces a $130 million payout after the Wall Street Journal reported that a federal court found a black former worker was subjected to a racially hostile work environment.
The economic data slate centers around activity in the services sector, with the ISM non-manufacturing PMI index, at 10 AM ET (1400 GMT), expected to have fallen to 60 in September from August’s 61.7.
Crude oil prices continued pushing higher Tuesday, following the decision of the Organization of the Petroleum Exporting Countries and allies led by Russia, a group known as OPEC+, to continue increasing output only gradually.
This decision came despite requests from consumers, including the U.S. and India, to increase supply as a method of curbing prices as demand recovers from the Covid-19 hit.
Investors now await U.S. crude oil supply data from the American Petroleum Institute, due later in the day.
By 7:05 AM ET, U.S. crude futures traded 0.8% higher at $78.20 a barrel, while the Brent contract rose 1% to $82.07. Both contracts gained well over 2% on Monday, with WTI hitting a seven-year high and Brent reaching a three-year peak.
Elsewhere, gold futures fell 0.7% to $1,756.05/oz, while EUR/USD traded 0.2% lower at 1.1599.