WASHINGTON (dpa-AFX) - Stocks may move to the downside in early trading on Wednesday, extending the steep drop seen in the previous session. The major index futures are currently pointing to a lower open for the markets, with the S&P 500 futures down by 0.3 percent.
Concerns about escalating tensions in the Middle East may continue to weigh on Wall Street following Iran's ballistic missile attack against Israel on Tuesday.
While Iran has said it is not interested in a wider war, the attacks have contributed to a surge by the price of crude oil, leading to worries higher energy prices will lead to a resurgence in inflation.
Waning optimism the Federal Reserve will continue to aggressively lower interest rates may also generate selling pressure after payroll processor ADP released a report showing stronger than expected private sector job growth in the month of September.
ADP said private sector employment climbed by 143,000 jobs in September after rising by an upwardly revised 103,000 jobs in August.
Economists had expected private sector employment to advance by 120,000 jobs compared to the addition of 99,000 jobs originally reported for the previous month.
On Friday, the Labor Department is due to release its more closely watched report on employment in the month of September.
Economists currently expect the report to show employment rose by 140,000 jobs in September after climbing by 142,000 jobs in August, while the unemployment rate is expected to hold at 4.2 percent.
After moving sharply lower early in the session, stocks regained some ground over the course of the trading day on Tuesday but remained firmly negative. The major averages all moved to the downside on the day, with the tech-heavy Nasdaq leading the way lower.
The Nasdaq tumbled 278.81 points or 1.5 percent to 17,910.36, the S&P 500 slumped 53.73 points or 0.9 percent to 5,708.75 and the Dow fell 173.18 points or 0.4 percent to 42,156.97.
With the decreases on the day, the Dow and the S&P 500 pulled back off the record closing highs set in Monday's session.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index plunged by 2.2 percent, while Hong Kong's Hang Seng Index spiked by 6.2 percent.
The major European markets have also turned mixed on the day. While the U.K.'s FTSE 100 Index is up by 0.1 percent, the French CAC 40 Index is down by 0.1 percent and the German DAX Index is down by 0.6 percent.
In commodities trading, crude oil futures are surging $2.04 to $71.87 a barrel after jumping $1.66 to $69.83 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $2,666.60, down $23.70 compared to the previous session's close of $2,690.30. On Tuesday, gold spiked $30.90.
On the currency front, the U.S. dollar is trading at 145.27 yen compared to the 143.57 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1055 compared to yesterday's $1.1068.
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