Market Update

The major U.S. index futures are pointing to a higher opening on Tuesday, with sentiment modestly positive as earnings news continue to be salubrious. While Asian stocks closed mixed, the European markets are rallying on M&A news flow. The domestic markets may also focus on the existing home sales report due to be released shortly after the markets open. That said, the mood could be subdued, given the recent advance.

U.S. stocks advanced on Monday, as earnings news continued to offer support. After opening mixed, the major averages moved uniformly higher in early trading. However, the averages retreated and briefly dipped into negative territory in late morning trading only to recover and advance steadily throughout the remainder of the session.

The Dow Industrials ended 40.71 points or 0.25 percent higher at 16,449 and the S&P 500 Index closed at 1,872, up 7.04 points or 0.38 percent. The Nasdaq Composite Index outperformed with a 26.03 point or 0.64 percent rally to end at 4,122.

Seventeen of the thirty Dow components advanced, while the remaining thirteen stocks receded. Home Depot , IBM , Johnson & Johnson , Merck and Pfizer were among the best performers of the session. On the other hand, UnitedHealth and Disney declined notably.

Among the sectors, pharmaceutical, biotechnology, Oil service and computer hardware stocks saw notable buying interest.

On the economic front, the Conference Board reported that its leading economic indicators index rose by a better than expected 0.8 percent month-over-month in March following a 0.5 percent increase in February.

The Dow Industrials has bounced below a resistance on Monday and currently finds itself constrained by the 16,403 level. Further above, the index also has resistance around the 16,482, 16,524 and 16,572 levels. On the downside the index has support around 16,403, its 21-day MA (currently at 16,343), 16,271, its 50-day MA (currently at 16,255) and its 100-day MA (currently at 16,181).