Stock futures rebound after yesterday's heavy losses

Stock futures point to a rebound from yesterday’s sharp losses even as most overseas markets are broadly lower; Dow +0.4%, Nasdaq +0.6%, S&P +0.7%.

The Nikkei closed at its lowest levels in four months after the yen jumped to a two-month high against both the dollar and euro; the index is -12% since hitting a six-year peak on Dec. 30.

Quarterly earnings received since yesterday's close have been mostly ahead of expectations; Michael Kors and Yum! should provide the consumer discretionary sector with a boost after both reported strong results.

But many analysts think we are in the midst of a correction that could pull the S&P down another 4%-5%; "We’re probably pretty much halfway through the correction," Rockwell Global's Peter Cardillo says. "We should see support levels between 1,710-1,720 on S&P; if that were to fail, then we’d go down to 1,675."

Treasurys hover near their lows, with the 10-year yield up nearly 4 bps at 2.62%.

Still ahead: U.S. factory orders.

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