Following the rally seen in the previous session, stocks are likely to see further upside in early trading on Wednesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 114 points.
The markets may benefit from signs that the U.S. elections will not result in a "blue wave" that sees the Democrats reclaiming both the White House and the Senate.
Votes are still being counted in a number of key swing states, but traders seem optimistic that Democrats will not take control of the Senate and roll back key tax cuts.
The White House remains up for grabs, but President Donald Trump's projected wins in states like Texas and Florida seems to have set traders' minds at ease.
The futures remained firmly positive even after a report from payroll processor ADP showed private sector employment increased by much less than expected in the month of October.
ADP said private sector employment rose by 365,000 jobs in October after spiking by an upwardly revised 753,000 jobs in September.
Economists had expected private sector employment to surge by 650,000 jobs compared to the jump of 749,000 jobs originally reported for the previous month.
"The labor market continues to add jobs, yet at a slower pace," said Ahu Yildirmaz, vice president and cohead of the ADP Research Institute. "Although the pace is slower, we've seen employment gains across all industries and sizes."
A separate report released by the Commerce Department showed the U.S. trade deficit narrowed in the month of September.
The Commerce Department said the trade deficit narrowed to $63.9 billion in September from a revised $67.0 billion in August.
Economists had expected the deficit to narrow to $63.8 billion from the $67.1 billion originally reported for the previous month.
The narrower deficit came as the value of exports jumped by 2.6 percent to $176.4 billion, while the value of imports rose by 0.5 percent to $240.2 billion.
Shortly after the start of trading, the Institute for Supply Management is scheduled to release its report on activity in the service sector in the month of October.
The ISM's Services PMI is expected to edge down to 57.5 in October from 57.8 in September, although a reading above 50 would still indicate growth.
Stocks moved sharply higher during trading on Tuesday, adding to the gains posted on Monday. The major averages all showed strong moves to the upside on the day.
The major averages finished the session firmly in positive territory. The Dow spiked 554.98 points or 2.1 percent to 27,480.03, the Nasdaq surged up 202.96 points or 1.9 percent to 11,160.57 and the S&P 500 jumped 58.92 points or 1.8 percent to 3,369.16.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index jumped by 1.7 percent, while Hong Kong's Hang Seng Index dipped by 0.2 percent.
Meanwhile, the major European markets have all shown strong moves to the upside on the day. While the French CAC 40 Index has surged up by 1.6 percent, the U.K.'s FTSE 100 Index and the German DAX Index are both up by 1.2 percent.
In commodities trading, crude oil futures are jumping $0.99 to $38.65 a barrel after climbing $0.85 to $37.66 a barrel on Tuesday. Meanwhile, an ounce of gold is trading at $1,909.90, down $0.50 compared to the previous session's close of $1,910.40. On Tuesday, gold jumped $17.90.
On the currency front, the U.S. dollar is trading at 104.48 yen compared to the 104.49 yen it fetched at the close of New York trading on Tuesday. Against the euro, the dollar is trading at $1.1710 compared to yesterday's $1.1715.
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