FX.co ★ U.S. Stocks May Regain Ground After Yesterday's Sell-Off

After a significant sell-off in the previous session, the stock market might tilt towards the upside in early trades on Wednesday. Indicators suggest that the markets, including the S&P 500 futures, will open higher, rising by roughly 0.5 percent.

Traders may perceive Tuesday's sharp plunge as a chance to buy at lower prices, optimistic about the market's future prospects. Although Tuesday's inflation data delayed hopes for an interest rate cut, continuous robust economic performance is anticipated to favor the markets in the long term.

However, trading activity could be somewhat muted due to the lack of significant U.S. economic data, which may result in some traders remaining inactive. Traders might hesitate to make substantial investments before a wave of data is released before Thursday's market opening. This data includes weekly jobless claims, retail sales, industrial production, and import and export prices.

Looking at specific stocks, Lyft's shares are seeing a significant surge in pre-market trading after the ride-sharing firm reported promising fourth-quarter results and optimistic guidance. Robinhood, the investment platform, is also experiencing pre-market growth after revealing fourth-quarter results that surpassed analyst predictions for revenue and earnings.

Contrarily, shares of Akamai Technologies may experience a downtrend after the network server provider announced stronger-than-anticipated fourth-quarter earnings but weaker-than-expected revenues.

The markets experienced a steep decline on Tuesday. All major averages showed notable downswings after the close of Monday's mixed trading session. The Dow retreated significantly from its record-high closing on Monday.

The major averages managed to recover slightly from their worst points during the closure but still ended the day with considerable losses. The Dow fell by 524.63 points or 1.4 percent to 38,272.75, the Nasdaq dropped by 286.95 points or 1.8 percent to 15,655.60, and the S&P 500 fell by 68.67 points or 1.4 percent to 4,953.17.

In international trades, Wednesday saw most Asia-Pacific stock markets declining. Japan's Nikkei 225 Index decreased by 0.7 percent and South Korea's Kospi dropped by 1.1 percent. However, Hong Kong's Hang Seng Index defied the downward trend, rising by 0.8 percent.

On the other hand, major European markets experienced an uplift. The U.K.'s FTSE 100 Index rose by 0.9 percent, the French CAC 40 Index by 0.6 percent, and the German DAX Index by 0.3 percent.

In commodities, crude oil futures increased by $0.38 to $78.25 a barrel after a $0.95 rise to $77.87 a barrel on Tuesday. Gold is trading at $2,005 an ounce, a $2.20 slip from the previous session's closing of $2,007.20.

In currency exchanges, the U.S. dollar is trading at 150.61 yen compared to the 150.80 yen at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.0712, a slight increase from Tuesday's $1.0709.