U.S. stock index futures were slightly lower during overnight trading Tuesday, after registering gains on the session amid signs of tensions easing between Russia and Ukraine.
Futures contracts tied to the Dow Jones Industrial Average shed 39 points. S&P 500 futures were down 0.16%, while Nasdaq 100 futures dipped 0.2%.
The major averages advanced during regular trading, snapping a three-day losing streak. The Dow gained 422 points, or 1.2%. The S&P added 1.58%, while the Nasdaq Composite rose 2.5%.
President Joe Biden addressed the latest developments between Russia and Ukraine Tuesday afternoon, reiterating that the U.S. will defend NATO territory.
"If Russia proceeds, we will rally the world," he said, adding that Washington's allies were ready to impose powerful sanctions that will "undermine Russia's ability to compete economically and strategically."
The comments came after the Russian government said earlier in the day that some troops who had been on the Ukrainian border had returned to their bases.
This helped boost sentiment on Wall Street. The yield on the benchmark 10-year Treasury topped 2% as a risk-on tone returned to the market.
Technology was the top-performing S&P 500 sector, with nine out of the 11 groups registering gains on the day. Utilities and energy stocks were the two sectors in the red, dipping 0.6% and 1.4%, respectively.
"U.S. stocks rallied on optimism that it doesn't seem like Russia will invade Ukraine this week and despite another hot PPI report, as many on Wall Street are still not convinced the Fed will be as aggressive as some are calling for this year," said Oanda's Ed Moya.
The Labor Department said Tuesday that wholesale prices jumped 1% in January, bringing the gain over the past 12 months to 9.7% on an unadjusted basis.
As inflation runs hot, Wall Street is looking ahead to the minutes from the Federal Reserve's January meeting, which will be released Wednesday at 2 p.m. ET.
"The latest inflation data continue to decimate the 'inflation is purely transitory' theory,'" said Michael Cembalest, chairman of market and investment strategy at J.P. Morgan Asset Management. "After pricing in less than one Fed hike as of last September, markets and Fed watchers now expect between 6 and 7 hikes over the next year, with some arguing for a 50 basis point move and not just 25."
Retail sales data will also be released Wednesday at 8:30 a.m. on Wall Street. Economists are expecting the print to show that sales rose 2.1% in January. That compares to a 1.9% decline in December.
Earnings season continues on Wednesday, with a number of companies slated to provide quarterly updates, including Applied Materials, Hyatt, AMC, Nvidia and Cisco Systems.
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