Stocks are indicated modestly higher Wednesday morning after a report on durable goods showed some improvement in February. Less than an hour before the opening bell on Wall Street, stock index futures indicate that the Dow Jones Industrial Average might gain 30 or 40 points in early trading.

Orders for durable goods unexpectedly rose last month. According to data released from the Commerce Department Wednesday morning, orders for goods designed to last several years rose 3.4 percent last month. Economists had expected a 2.5 percent drop.

Stock index futures rose on the news and bonds are under pressure. The yield on the benchmark ten-year Treasury bond is up to 2.75 percent, from about 2.66 percent the day before.      

The dollar is coming off lows of the day, down .39 to 97.83 on the yen.  The euro gained .0041 to 1.3514 on the dollar.

A report on new home sales is due out at 10:00 a.m. eastern time. Economists expect a decline to an annualized rate of 300,000 homes in February, down from 309,000 the month before.   

Crude oil is off $1.43 to $52.55 ahead of crude oil inventory data due out at 10:30 a.m. eastern time. Gold slipped $3.70 to $920 an ounce.    

Among the stocks to watch, Morgan Stanley (MS) might see some action on talk the investment bank might merge its Japanese securities business with Mitsubishi Financial. Dryships (DRYS) is down more than $1.00 to $4.50 per share after the company reported earnings of 43 cents per shares. Analysts were looking for 66 cents. CIT Group (CIT) is up 4 percent after S&P cut its credit rating on CIT, but said that it is becoming less worried about the company's near-term liquidity position.

In the options market, trading slowed some Tuesday, as a lack of meaningful news and slumping stocks sidelined some traders. The Dow Jones Industrial Average lost 115 points following a late-day drop in the banks. The CBOE Volatility Index (.VIX) slipped .30 to 42.93 and approximately 7.9 million calls and 6 million puts traded.

Las Vegas Sands (LVS) saw a second day of bullish order flow. 45,000 calls and 1,400 puts traded Monday. Tuesday, shares jumped 39 cents to $3.04 and the action in the options market continued. Another 72,000 calls and 4,575 puts traded. April 5 calls saw heavy volume. More than 43,700 contracts traded. While some investors bought premium on hopes for higher prices, it seems that sellers dominated the flow. Some traders might have been closing bullish positions opened Monday, as the stock moved higher Tuesday.

Bullish trading was also seen in Dryships (DRYS), Allergan (AGN), and Seagate Technology (STX). 

Best Buy (BBY) puts were heavily traded ahead of an earnings report due out Thursday before the opening bell. Shares lost 86 cents to $33.24 and total options volume rose to 2X the average daily levels.  51,000 put options traded on the electronics retailer, compared to 18,000 call options.  Bearish trading also surfaced in Crucell (CRXL), McAfee (MFE), and Bed, Bath and Beyond (BBBY).

Frederic Ruffy
WhatsTrading.com