Williamson missed wins over defending champions England and the Netherlands to work on his fielding and running between the wickets and Stead said he was pleased with his progress ahead of Friday's game.
"He's had a great last five or six days, really ramped up the fielding aspect of things," Stead told reporters.
"That's the key for Kane at the moment. It's not about his injury so much now, it's his ability to run between the wickets and to field and to consistently do that over a 50-over game.
"We've got two more trainings still to get through but at this stage, all things are looking good for Kane to return in this game. We still say that with an air of caution but we're really pleased with the way he has been coming on."
Rachin Ravindra has impressed batting at number three in the absence of Williamson with an unbeaten 123 against England and 51 against the Dutch.
"If Kane is available, he'll play," Stead said. "There's no doubt about that. He's one of the best players in the world. The discussions we're having at the moment is how does that still fit?
"For example, we played Jimmy Neesham in the first game but not the second. That was around the conditions we thought best suited the team at the time.
"That's the ongoing discussion we have around every single game and also looking at the opposition and who we feel gives us the right balance in each situation."
Stead said paceman Tim Southee was also in contention after recovering from a fractured thumb.
"Tim will be available for selection, he's been tracking well," Stead said.
"Looks like the thumb has set very well. He's been bowling at full intensity for the last couple of training sessions."
