US stock futures were slightly lower in early morning trading on Tuesday after the Dow Jones Industrial Average posted its best day since March on Monday.
The Dow Jones Industrial Average futures fell 40 points. The futures on the S&P 500 and Nasdaq 100 were both trading in slightly negative territory.
During Monday's regular session, the Dow rose 586.89 points, or 1.76%. The S&P 500 ended the day up 1.4% and the Nasdaq Composite up 0.79%.
The indices made up for some of the steep losses suffered last week when the Federal Reserve's updated inflation forecast announced a sell-off. Commodity stocks like Devon Energy and Occidental Petroleum led the market comeback on Monday after being hit hard last week. Norwegian Cruise Line and Boeing's shares rose more than 3% as the economy reopened.
"Equities saw a strong rebound on Monday, even though S&P only made up for Friday's decline," said Adam Crisafulli of Vital Knowledge. "Cyclical stocks may have rallied on Monday, but they are still in a bearish trend and investors should take advantage of rallies for gains."
Federal Reserve chairman Jerome Powell will testify in front of the House of Representatives on Tuesday about the central bank's response to the pandemic. His remarks, released ahead of the Monday evening hearing, should support the notion that the Fed is ready to begin discussions soon on the removal of some of its unprecedented stimulus measures taken during the pandemic.
"Since our last meeting, the economy has improved sustainably," Powell will say, according to a Fed announcement on Tuesday. “The widespread vaccination, along with unprecedented monetary and fiscal measures, has been a major contributor to the recovery. Activity and employment indicators have continued to strengthen, and real GDP appears to be well on track this year to show its fastest increase in decades. "
"Inflation has increased significantly in the past few months," Powell will say. The Fed chief will note, however, that most of these effects are temporary and inflation should settle back at 2% in the long term.
On Tuesday morning, the Federal Reserve Bank of Philadelphia will publish its non-manufacturing business data, the National Association of Realtors will publish its existing home sales data for May, and the Federal Reserve Bank of Richmond will publish the results of its monthly manufacturing activity survey .