By Sara Sjolin, MarketWatch

U.S. manufacturing PMI and ISM data are also in focus

U.S. stocks were poised to rebound Tuesday, with futures pointing higher after strong Chinese manufacturing data instilled more confidence in global growth and sent global stock markets higher.

Investors were waiting for the latest on U.S. manufacturing, with purchasing managers' index and ISM data due early in the day.

Futures for the Dow Jones Industrial Average rose 41 points, or 0.2%, to 18,103, while those for the S&P 500 index added 6.15 points, or 0.3%, to 2,126.25. Futures for the Nasdaq 100 index gained 11.75 points, or 0.2%, to 4,808.50.

The gains came after all three benchmarks ended lower on Monday (http://www.marketwatch.com/story/cautious-open-ahead-for-us-stocks-as-investors-watch-for-more-fbi-fallout-2016-10-31), as a drop in oil prices and uncertainty ahead of the U.S. presidential election next week weighed on investors' minds. The S&P 500 slipped less than 1 point on Monday, while the Dow average fell 18.77 points.

On Tuesday, oil prices were in recovery mode, helping give sentiment about equities a slight boost. Crude oil was up 0.1% at $46.88 a barrel, while Brent added 0.4% to trade at $48.81.

Stock futures were also buoyed by upbeat data from China, where the official manufacturing PMI for October rose to a two-year high (http://www.marketwatch.com/story/china-manufacturing-pmi-at-highest-since-july-2014-2016-11-01) of 51.2, from September's 50.4.

"Chinese PMI data for October surprised strongly on the upside, adding to the picture of a global recovery and putting more fuel on the reflation theme," analysts at Danske Bank said in a note.

"The data are positive for risk assets, as they underpin the picture of a global cyclical rebound," they added.

Stocks, which are considered risk assets, closed mostly higher in Asia (http://www.marketwatch.com/story/asian-stocks-mostly-up-after-upbeat-manufacturing-data-from-china-2016-10-31), with Hong Kong's Hang Seng rising 0.9%. European stocks opened higher, but turned lower midmorning (http://www.marketwatch.com/story/earnings-gloom-swings-european-stocks-lower-2016-11-01)as disappointing earnings reports came in. Prices of metals, which are sensitive to growth news out of China, rose across the board.

Economic news: Manufacturing activity was also a focus in the U.S., where the Markit PMI and the ISM index are due to come out at 9:45 a.m. Eastern Time and 10 a.m. Eastern, respectively.

Economists polled by MarketWatch expect the ISM to inch up to 51.7% from 51.5% in September.

"In theory, weak growth in the ISM index might be negative for the dollar," said Marshall Gittler, head of investment research at FXPrimus, in a note.

"However, the closely watched ISM prices paid index is forecast to rise as well. That's seen as a harbinger of inflation trends. If that turns up, then even if the economy slows, the [Federal Reserve] can still go ahead and tighten policy. That would make it positive for the dollar," he added.

The Fed kicks off its two-day policy meeting on Tuesday and will announce its rate decision on Wednesday. The central bank is widely expected to keep interest rates on hold this time, but for the December meeting, analysts are forecasting a rate hike.

At 10 a.m. Eastern, construction spending figures are due. Monthly car sales are expected to trickle out through the day.

See:

The ICE dollar index was down 0.3% at 98.202 premarket on Tuesday.

The yen slipped after the Bank of Japan made no changes to policy (http://www.marketwatch.com/story/bank-of-japan-lowers-inflation-outlook-holds-off-on-more-stimulus-2016-10-31). The pound pared its gains that came after Bank of England Governor Mark Carney late Monday said he'll remain in his post until June 2019 (http://www.marketwatch.com/story/bank-of-england-gov-mark-carney-to-leave-post-in-june-2019-2016-10-31).

Movers and shakers: U.S.-listed shares of Royal Dutch Shell PLC(RDSB.LN) (RDSB.LN) rose 4.6% ahead of the open after the oil giant reported a rise in third-quarter profit (http://www.marketwatch.com/story/shell-swings-to-profit-but-cautious-in-oil-view-2016-11-01).

Shares of Brocade Communications Systems Inc.(BRCD) could also be active, after they soared more than 20% on Monday on reports it is in advanced talks to sell (http://www.marketwatch.com/story/brocade-stock-soars-on-report-of-sale-talks-2016-10-31) itself.

Pfizer Inc.(PFE) dropped 2.2% premarket after the drug giant reported third-quarter earnings and revenue slightly below forecasts.

Coach Inc. (COH) slipped 0.2% before the bell even as fiscal first-quarter revenue beat views.

Archer Daniels Midland Co.(ADM) gained 2.6% ahead of the open after the food processing company beat earnings forecast for the third quarter.

Molson Coors Brewing Co.(TAP) said global beer volumes were down 3.8% in the third quarter.

Kellogg Co.(K) was also slated to report premarket.

(END) Dow Jones Newswires

November 01, 2016 07:24 ET (11:24 GMT)

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