April 12, 2012- Markets Edge Higher Look to Confirm Momentum

The major U.S. index futures are pointing to a higher opening on Wednesday, with sentiment getting a lift from forecast-beating results reported by Alcoa (AA). The previous session’s declines should give some opportunity for traders to pick up stocks on bargain, as hopes concerning a healthy reporting season is gaining ground. The re-emergence of risk appetite is reflected in the firming up of oil prices and commodities. The Beige Book to be released shortly after the markets open may also provide some trading cues. U.S. stocks succumbed to European debt fears and fell sharply on Tuesday, with the Dow Industrials and the S&P 500 Index declining for the fifth straight session. The major U.S. averages opened on a nervous note, as earnings optimism allayed economic fears. However, with Spanish bond yields surging in reaction to concerns about the nation’s fiscal situation, the averages declined steadily and sharply, in line with the negative mood in Europe. The selling momentum slowed in the afternoon and the averages consolidated for the rest of the session, closing notably lower.