Stocks were poised to pop Tuesday as falling interest rates, another decline in oil prices and gold's move above $500 an ounce helped cure a brief case of risk aversion.
Index futures recently showed the
trading 4 points above fair value, while the Nasdaq 100 was set for a 7-point jump. Stocks are coming off their first down day in more than a week, with the
Dow Jones Industrial Average
losing 0.4% to 10,891 and the
falling 1% to 2239.
The 10-year Treasury bond rose 1/32 in price to yield 4.40%, while the dollar rose against the yen and euro.
Treasury yields backed down on Monday after a report showed a slowdown in sales of pre-owned homes last month. The report led to a downgrade of
at Morgan Stanley Tuesday.
On Tuesday, investors will see reports on consumer confidence and durable goods orders.
Gold, which is up 14% in 2005, briefly crossed over the $500 mark for the first time in 18 years on Nymex earlier. The metal, which traditionally is used as a hedge against inflation, has also benefited from heightened jewelry demand and a recent prediction by the head of
that the metal is headed to $1,000.
Oil, meanwhile, which lost $1.41 a barrel on Monday, continued to ease, recently trading down 46 cents to $56.90 on the January contract. Warm weather in the Northeast, calming words from OPEC and the steady rebuilding of Gulf Coast energy infrastructure has contributed to the move.
Overseas markets were mixed, with London's FTSE 100 recently down 0.1% to 5470 and Germany's Xetra DAX adding 0.1% to 5179. In Asia, Japan's Nikkei fell 0.4% overnight to 14,928, while Hong Kong's Hang Seng slipped 0.5% to 15,029.
In corporate news,
, the disk-drive maker sometimes used as a proxy for consumer hardware sales, bumped up second-quarter earnings guidance Monday thanks to strong sales of notebooks and PCs.
The news was followed by an upgrade of
at Goldman Sachs, which cited strong demand among business customers and for parts used in
Elsewhere in ratings news, UBS cut
to neutral from buy, citing margin decay in the company's traditional local telephony division.
is up more than 3% on Instinet after raising its 2006 profit estimate late Monday on strength in generic drug use and growth in its specialty pharmacy business.