Fueled by gains overseas, equities are trying to rebound from their steepest drop so far this year.
S&P 500 futures are up about 0.3 percent after climbing by more than half a percentage point. European indexes have added more than 0.5 percent. The real strength came from China, where value hunters drove Shanghai and Hong Kong higher by more than 2 percent.
Investors must now decide whether it's time to put money to work in stocks or whether the recent losses are the start of a deeper correction. Recent data and corporate results suggest that economic activity is slowing, but large amounts of cash remain on the sidelines.
The S&P 500 closed below its 50-day moving average yesterday for the first time since December. But sectors associated with risk appetite such as transportation stocks fell less than the broader market, while energy shares rallied strongly. This suggests that some investors think conditions will improve before they worsen further.
Today's optimism in China partially resulted from a government official stating that growth may accelerate through the end of the third quarter. The Japanese yen also continued its recent declines, which tends to support global stock prices.
Corporate results from General Electric, Google, and Microsoft were mostly better than expected, though IBM and McDonald's missed estimates.
In addition to the steep losses for the yen, the euro, Australian dollar, and Canadian dollar are all gaining, which also supports risk appetite. Oil is up three-quarters of percent and precious metals are up more than a full percentage point, though copper and most agricultural products are weak.
Elsewhere in company-specific news, Vertex Pharmaceuticals is indicated to surge more than 50 percent after announcing positive mid-stake results for its cystic fibrosis drug. Dell may also be active amid reports that Blackstone will drop its proposed takeover bid.
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