By Tomi Kilgore and Tommy Stubbington
U.S. stock futures gained Tuesday, extending the previous session's sharp rise, with upbeat earnings from some blue-chip companies helping set a positive tone.
About 90 minutes ahead of the open, Dow Jones Industrial Average futures tacked on 34 points, or 0.2%, to 16130.
S&P 500 index futures advanced five points, or 0.3%, to 1829 and Nasdaq-100 futures rose 10 points, or 0.3%, to 3480. Changes in stock futures don't always accurately predict stock moves after the opening bell.
On Monday, stocks staged a broad rally as investors focused on strong retail sales data and better-than-expected earnings from banking giant Citigroup. The Dow climbed 146 points, or 0.9%, on Monday, while the recently hard hit Nasdaq Composite Index gained 0.6%.
The gains offered investors a reprieve from the downturn in stocks this month. Until Monday's bounce, the S&P 500 had fallen 4% since closing at a record high on April 2, while the Nasdaq had dropped 8.2% since closing at a 14-year high on March 5.
Earnings from Dow components helped further support sentiment early Tuesday. Coca-Cola gained 2.3% in premarket trading after first-quarter adjusted earnings met estimates, while revenue rose slightly above forecasts, amid an increase in world-wide case volume.
And Johnson & Johnson advanced 2.1% after reporting better-than-expected first-quarter earnings and raising its full-year outlook.
Fellow Dow member Intel, which is slated to report results after the close, edged up 0.3%.
Many investors remain upbeat on stocks in the long term, given an improving economy and an accommodative Federal Reserve, but they expect some additional volatility in the near term, especially in the once-highflying biotechnology stocks and shares of relatively young Internet companies.
Adam Grimes, chief investment officer at Waverly Advisors, which provides tactical research and advisory services to traders and money managers, expects more volatility in the short term, as the market is no longer acting like it did during last year's strong bull run. "This is a market that is reminding us that it doesn't have to go straight up," Mr. Grimes said.
For long-term investors, however, Mr. Grimes said the market still looks very bullish, so they should just "sit tight" in the current volatile market environment. "You don't necessarily want to be buying dips, but you don't want to be selling into them, either," Mr. Grimes said. "It is a time for no action."
At 8:30 a.m. Eastern, the consumer-price index for March is expected to rise 0.1% on the month, and by 0.1% when excluding the food and energy components. At the same time, the New York the New York Federal Reserve's Empire State index of manufacturing activity for April is seen rising to 8.0 from 5.61 in March. After the open, the National Association of Home Builders' housing-market index for April is forecast to rise to 50 from 47 in March.
The yield on the 10-year Treasury note ticked up to 2.662% from 2.637% late Monday.
Crude-oil futures eased 0.9% to $103.12 a barrel, after settling at a six-week high on Monday, while gold futures fell 1.8% to $1,304.20 an ounce. The dollar gained against the euro, but eased slightly against the yen.
European markets edged lower, with investors cautious following the recent flare-up of tensions in Ukraine. The Stoxx Europe 600 slipped 0.1%. Germany's DAX 30 index gave up 0.3%, France's CAC 40 edged up 0.2% and the U.K.'s FTSE 100 was virtually unchanged.
On Tuesday, Ukraine's acting president Oleksandr Turchynov said that a military operation to wrest control of cities in eastern Ukraine from pro-Russian militants has begun. There were no immediate reports of specific action, however.
"We are a bit more concerned after the escalation in Ukraine over the weekend," said Christopher Wright, a cross-asset strategist at UBS Wealth Management. "That's adding a bit of a risk premium to markets."
Separately, data showed investor confidence in Germany declined for the fourth month in a row in April, amid concerns over Ukraine.
Asian markets were mostly lower, with China's Shanghai Composite shedding 1.4% ahead of the release of China's first-quarter growth numbers on Wednesday. Meanwhile, Japan's Nikkei Stock Average gained 0.6% to bounce off a six-month closing low on Monday.
In other corporate news, Motorola Solutions gained 0.7% after the company agreed to sell its enterprise business to Zebra Technologies for $3.45 billion in cash. Zebra's stock rallied 9.8%.
General Electric tacked on 0.4% after The Wall Street Journal reported the company's chief executive officer Jeff Immelt may give up leadership of the industrial conglomerate sooner than his expected 20-year tenure. Mr. Immelt has run GE for 13 years, but he and fellow directors are re-evaluating the right term for its CEO.
Write to Tomi Kilgore at firstname.lastname@example.org and Tommy Stubbington at email@example.com
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