Wall Street was set for a modestly higher open on Wednesday, potentially bouncing back from two sessions of losses as investors regained some optimism about the strength of the market rally.
Health insurers could rise after Senate Democratic healthcare negotiators said they agreed to replace a government-run insurance option with a scaled-back non-profit plan.
Shares of Corning Inc
The inverse correlation between equities and the U.S. dollar also appeared intact as the greenback <.DXY> slipped 0.2 percent against a basket of currencies.
After a market rally of more than 60 percent from March's 12-year low, stocks have drifted in recent sessions as investors locked in profits and looked ahead to the new year. With the broad S&P 500 up nearly 21 percent for 2009, investors are reluctant to lose any gains.
Traders want to know if this is the start of a new trend downward or just a reaction to news that snaps back, said Barry Ritholtz, director of equity research at Fusion IQ in New York. So far it looks like the bet is this is going to be a modest snap back after (a) fall.
Stocks fell 1 percent on Tuesday after disappointing corporate news from 3M Co
S&P 500 futures rose 0.8 points and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures gained 9 points, while Nasdaq 100 futures added 2.50 points.
The Obama administration plans to announce on Wednesday it intends to extend the life of the $700 billion financial bailout fund until next October, administration officials said. The move should help soothe worries officials would remove efforts to prop up the economy too soon.
Sprint Nextel Corp
Chip maker Texas Instruments Inc
(Editing by Padraic Cassidy)