WASHINGTON (dpa-AFX) - After ending the previous session moderately lower, stocks may see some further downside in early trading on Tuesday. The major index futures are currently pointing to a modestly lower open for the markets, with the Dow futures down by 83 points.
Geopolitical concerns may continue to weigh on the markets amid uncertainty about the U.S. response to the attacks on Saudi Arabian oil facilities.
President Donald Trump has indicated the U.S. is prepared to respond militarily but has stopped short of definitively blaming Iran for the attacks.
Trump told reporters diplomacy has not been exhausted when it comes to Iran and would not rule out meeting with Iranian President Hassan Rouhani on the sidelines of the United Nations General Assembly next week.
Overall trading activity is likely to remain somewhat subdued, however, as traders await the Federal Reserve's monetary policy decision on Wednesday.
The Fed is widely expected to lower interest rates by another 25 basis points, with CME Group's FedWatch Tool currently indicating a 65.8 percent chance of a quarter-point rate cut.
Traders are likely to pay close attention to the Fed's accompanying statement for clues about the long-term outlook for rates.
The Fed is scheduled to release its report on industrial production in the month of August just before the start of trading. Industrial production is expected to rise by 0.2 percent in August after dipping by 0.2 percent in July.
Shortly after the open, the National Association of Home Builders is due to release its report on homebuilder confidence in the month of September. The housing market index is expected to come in unchanged after inching up to 66 in August.
Reflecting concerns about the impact of skyrocketing oil prices, stocks saw moderate weakness during trading on Monday. The major averages all moved to the downside, partly offsetting the strong gains posted last week.
The major averages climbed off their worst levels of the day but still closed in negative territory. The Dow slid 142.70 points or 0.5 percent to 27,076.82, the Nasdaq fell 23.17 points or 0.3 percent to 8,153.54 and the S&P 500 dropped 9.43 points or 0.3 percent to 2,997.96.
In overseas trading, stock markets across the Asia-Pacific region turned in another mixed performance during trading on Tuesday. Japan's Nikkei 225 Index inched up by 0.1 percent, while Hong Kong's Hang Seng Index tumbled by 1.2 percent.
The major European markets have also turned mixed on the day. While the U.K.'s FTSE 100 Index is just above the unchanged line, the French CAC 40 Index is down by 0.2 percent and the German DAX Index is down by 0.5 percent.
In commodities trading, crude oil futures are sliding $0.76 to $62.14 barrel after soaring $8.05 to $62.90 a barrel on Monday. Meanwhile, after jumping $12 to $1,511.50 ounce in the previous session, gold futures are inching up $0.10 to $1,511.60 an ounce.
On the currency front, the U.S. dollar is trading at 108.15 yen compared to the 108.12 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.1029 compared to yesterday's $1.1001.
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