Soft opening expected for small caps

Small-cap stocks are expected to open slightly lower Tuesday, in line with mild declines in after-hours trading. The Russell 2000 (NYSE:IWM) was down about 0.3% overnight, which would translate to a cash opening near 716. Look for initial support for the Russell this morning at 714, then at 709 and 705. On the upside, resistance remains near 724, then at 731.

The market’s pullback Tuesday was confined to an inside session move, and was consistent with a mild overbought correction. As long as the market doesn’t sink through 709, it won’t endanger the advance from late last week.

Stock indices around the world were narrowly mixed overnight, with Japan’s Nikkei down 1%, Hong Kong’s Hang Seng up 0.8% and Europe markets slightly mixed depending on the nation. The U.S. dollar was flat to soft overnight, crude oil remained bid amid strife in producing country Nigeria, a refinery strike in Scotland . . .

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