Russell to open higher

Small-cap stocks are expected to push higher Tuesday, extending the run from Monday’s GSE takeover. There was an improved tone on the tech front early today, which was an encouraging sign since tech stocks have been lagging lately on concerns about global growth and a reduction in spending on technology. Also, crude oil futures tumbled to five-month lows, which will help the consumer spending outlook. S&P 500 futures were up about 0.3% in after-hours trading, which would suggest an opening for small-caps in the 735.00 range.

Agency and mortgage backed security debt rallied significantly in the wake of the GSE news, which pulls down mortgage interest rates, one important component of the GSE plan that will help — but not necessarily save — the troubled housing sector.

As for tech stocks, bellwether Hewlett-Packard Co. (NYSE:HPQ) was up 2% in overnight trading and Nasdaq futures were 0.6% higher after struggling well behind the other index products in recent days.

Crude oil prices turned lower ahead of the opening, sinking some $2 a barrel toward $104.30, slipping to five-month lows in the process. Sellers were still prominent in oil even though Hurricane Ike was pressing into the Gulf of Mexico. OPEC leaders were meeting in Vienna today, but were expected to hold output targets in place. The OPEC meeting is slated to begin around 9:00 a.m. ET.

Looking at the chart picture, we see that the market was able to hold above the opening gap Monday despite a steep pullback off the morning highs. When . . .

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