The major U.S. index futures are pointing to a modestly higher opening on Tuesday, with stocks likely to add to the slim gains posted in the previous session.
Early buying interest may be generated in reaction to upbeat earnings news from big-name companies such as Goldman Sachs (GS) and Johnson & Johnson (JNJ).
Goldman Sachs and Johnson & Johnson both reported second quarter results that exceeded analyst estimates on both the top and bottom lines, with J&J also boosting its full-year sales guidance.
On the other hand, shares of JPMorgan (JPM) are seeing pre-market weakness after the financial giant reported better than expected second quarter earnings but cut its forecast for 2019 net interest income.
A report from the Commerce Department showing much stronger than expected U.S. retail sales growth may also keep buying interest subdued amid concerns the data could reduce the chances of a near-term interest rate cut.
After reaching new record intraday highs early in the session, stocks showed a lack of direction over the course of the trading day on Monday. Despite the choppy trading on the day, the major averages ended the session at new record closing highs.
The major averages finished the day modestly higher. The Dow inched up 27.13 points or 0.1 percent to 27,359.16, the Nasdaq rose 14.04 points or 0.2 percent to 8,258.19 and the S&P 500 crept up 0.53 points or less than a tenth of a percent to 3,014.30.
The initial strength on Wall Street partly reflected a positive reaction to earnings news from Citigroup (C), with the financial giant reporting second quarter results that beat analyst estimates on both the top and bottom lines.
Buying interest waned shortly after the start of trading, however, as traders seemed reluctant to make more significant moves ahead of the release of quarterly results from a slew of other big-name companies.
Goldman Sachs (GS), Johnson & Johnson (JNJ), JPMorgan (JPM), Kraft Heinz (KHC), IBM (IBM), Microsoft (MSFT), and America Express (AXP) are among the companies due to report their results this week.
Closely watched reports on retail sales, industrial production, homebuilder confidence and housing starts are also likely to attract attention over the next few days.
On the U.S. economic front, the Federal Reserve Bank of New York released a report before the start of trading showing regional manufacturing activity rebounded modestly in the month of July.
The New York Fed said its general business conditions index climbed to 4.3 in July from a negative 8.6 in June, with a positive reading indicating growth in regional manufacturing activity. Economists had expected the index to rise to a positive 2.0.
The bigger than expected rebound by the general business conditions index came after it recorded its first negative reading in over two years in the previous month.
Most of the major sectors ended the day showing only modest moves, contributing to the lackluster performance by the broader markets.
Natural gas stocks showed a significant move to the downside, however, with the NYSE Arca Natural Gas Index tumbling by 2.3 percent.
Oil and gas company Callon Petroleum (CPE) posted a steep loss after agreeing to acquire Carrizo Oil & Gas (CRZO) in an all-stock transaction valued at $3.2 billion.
Oil service and banking stocks also saw considerable weakness on the day, while notable strength was visible among biotechnology stocks.
Within the biotech sector, Galapagos (GLPG) spiked after Gilead Sciences (GILD) agreed to invest $5.1 billion in the company as part of a 10-year global research and development collaboration.
Commodity, Currency Markets
Crude oil futures are inching up $0.14 to $59.72 barrel after falling $0.63 to $59.58 a barrel on Monday. Meanwhile, after rising $1.30 to $1,413.50 ounce in the previous session, gold futures are slipping $2.20 to $1,411.30 an ounce.
On the currency front, the U.S. dollar is trading at 108.23 yen compared to the 107.91 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1213 compared to yesterday's $1.1258.
Asia
Asian stocks turned in a mixed performance on Tuesday as investors awaited earnings results from major U.S. companies as well as key economic data.
Chinese shares slipped into the red after three sessions of gains. The benchmark Shanghai Composite Index dipped 4.57 points or 0.2 percent to 2,937.62, although Hong Kong's Hang Seng Index inched up 64.74 points or 0.2 percent to 28,619.62.
Japanese shares retreated on growth worries. The Nikkei 225 Index ended down 150.65 points or 0.7 percent at 21,535.25 as traders returned to their desks after a national holiday on Monday. The broader Topix closed 0.5 percent lower at 1,568.74.
Exporters, Canon, Sony and Panasonic lost 1-3 percent. Market heavyweight SoftBank Group shed 1.2 percent, Fanuc Corp slid 1.5 percent and FamilyMart slumped 2.7 percent.
On the other hand, Toyota Motor climbed 1.3 percent on buzz China will shift its automotive strategy to rely more on hybrid vehicles.
Australian markets finished marginally lower, dragged down by financials and energy companies. The S&P/ASX 200 Index dropped 12.00 points or 0.2 percent to 6,641.00, while the broader All Ordinaries Index ended down 10.40 points or 0.2 percent at 6,735.80.
Banks Commonwealth, NAB and Westpac fell between 0.3 percent and 0.7 percent as minutes from the Reserve Bank of Australia's monetary policy meeting in July showed the central bank was ready to cut rates again this year "if needed."
Rio Tinto shed 0.6 percent despite the mining giant warning of further delays and a cost blowout of up to $1.9 billion at its Oyu Tolgoi underground copper mine in Mongolia. BHP rose 0.4 percent and smaller rival Fortescue Metals Group advanced 1.7 percent.
Woodside Petroleum and Beach Energy fell over 2 percent after crude oil futures declined more than 1 percent on Monday on concerns about energy demand. Oil Search declined 2.2 percent after lowering its annual production target.
Seoul stocks advanced as investors awaited cues from the second quarter earnings results to be released later this month.
The benchmark Kospi climbed 9.39 points or 0.5 percent to finish at 2,091.87. Automakers bucked the uptrend, with Hyundai Motor tumbling 3.6 percent and Kia Motors declining 1.9 percent.
Europe
European stocks have moved moderately higher on Tuesday as traders react to the latest batch of earnings news while awaiting developments on the U.S.-China trade front.
While the French CAC 40 Index has risen by 0.5 percent, the U.K.'s FTSE 100 Index is up by 0.4 percent and the German DAX Index is up by 0.3 percent.
British luxury brand Burberry has moved sharply higher after the company delivered strong growth in its new collections.
German chemicals company Bayer has also advanced after a U.S. judge slashed the damages awarded to a California man who blamed the company's Roundup weed killer for his cancer.
French luxury goods group LVMH has also risen after it acquired a minority stake in the Stella McCartney House from Ms Stella McCartney.
On the other hand, Groupe Renault has moved to the downside after the French carmaker reported weak volume in its first half.
In economic news, German economic confidence weakened to an eight-month low in July, survey data from the ZEW-Leibniz Centre for European Economic Research showed.
The economic confidence index declined to -24.5 in July from -21.1 in June. This was the lowest score since November 2018. The expected reading was -22.
Data from the Office for National Statistics revealed the U.K. unemployment rate remained unchanged at 44-year low in the three months to May and wages grew at the fastest pace in 11 years,
The unemployment rate remained unchanged at 3.8 percent in the three months to May, in line with expectations. This was the lowest since the final quarter of 1974.
U.S. Economic Reports
Retail sales in the U.S. climbed much more than expected in the month of June, according to a report released by the Commerce Department on Tuesday.
The Commerce Department said retail sales rose by 0.4 percent in June, matching the downwardly revised increase in May.
Economists had expected retail sales to inch up by 0.1 percent compared to the 0.5 percent growth originally reported for the previous month.
Excluding a continued increase in auto sales, retail sales still rose by 0.4 percent in June after climbing by a downwardly revised 0.4 percent in May.
Ex-auto sales had also been expected to tick up by 0.1 percent compared to the 0.5 percent increase originally reported for the previous month.
A separate report from the Labor Department showed U.S. import prices fell by more than expected in the month of June.
The Labor Department said import prices tumbled by 0.9 percent in June, while revised data showed prices were unchanged in May.
Import prices had been expected to drop by 0.7 percent compared to the 0.3 percent decrease originally reported for the previous month.
The report also showed a continued decrease in export prices, which slumped by 0.7 percent in June after dipping by 0.2 percent in May. Economists had expected another 0.2 percent drop.
The Federal Reserve is scheduled to release its report on industrial production in the month of June at 9:15 am ET. Industrial production is expected to edge up by 0.2 percent in June after rising by 0.4 percent in May.
At 10 am ET, the National Association of Home Builders is due to release its report on homebuilder confidence in the month of July. Economists expect the housing market index to come in unchanged in July after dipping to 64 in June.
The Commerce Department is also scheduled to release its report on business inventories in the month of May at 10 am ET. Business inventories are expected to rise by 0.4 percent in May after climbing by 0.5 percent in April.
At 10:05 am ET, Atlanta Federal Reserve President Raphael Bostic is due to deliver closing remarks at a Fed Listens event in Augusta, Georgia.
Dallas Fed President Robert Kaplan is scheduled to speak at the National Association For Business Economics annual Economic Measurement Seminar in Washington, D.C., at 12:20 pm ET.
At 1 pm ET, Fed Chair Jerome Powell is slated to deliver a speech on Aspects of Monetary Policy in the Post-Crisis Era at an event in Paris, France, celebrating the 75th anniversary of the Bretton Woods conference.
Chicago Fed President Charles Evans is due to participate in a moderated Q&A at a CNBC @Work event in Chicago, Illinois, at 3:30 pm ET.
Stocks In Focus
Shares of J.B. Hunt Transport Services (JBHT) are moving sharply higher in pre-market trading after the trucking reported better than expected adjusted second quarter earnings on revenues that exceeded estimates.
On the other hand, shares of KeyCorp (KEY) are seeing notable pre-market weakness after the bank revealed it has discovered "fraudulent activity" conducted by a business customer.
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