U.S. stock futures climb after three days of heavy selling

US equities futures rose on Tuesday, moving higher after three days of strong sales on the eve of the key inflation report.

What is happening
  • Dow Jones Industrial Average YM00 futures
    + 0.86%
    increased 279 points, or 0.9% to 32,440.

  • Futures of the S&P 500 ES00,
    + 1.03%
    gained 40.75 points, or 1%, to 4028.

  • Futures on the Nasdaq 100 NQ00,
    + 1.63%
    increased 189.25 points, or 1.6% to 12,383.

On Monday, the Dow Jones Industrial Average DJIA,
fell 654 points, or 1.99%, to 32,246, the S&P 500 SPX,
decreased 132 points, or 3.2%, to 3991, and the Nasdaq Composite COMP,
it dropped 521 points, or 4.29%, to 11,623.

Over the past three days, the S&P 500 has fallen 7.2%, the biggest three-day drop since March 20, 2020, as the world faced the coronavirus pandemic.

What is driving the markets

The anticipated rise may make traders think that the so-called “Tuesday of change” can materialize. Bank of America data show that the best returns on the S&P 500 this year were on Mondays, although the cumulative loss of 1.2% on Tuesday is much smaller than the 10.6% drop on Thursday. and the 7.9% drop on Thursday.

In any case, news of corporate earnings since Monday’s close has been negative, with sharp gains related to corporate earnings, such as the UPST Upstart Holdings lending platform,
Groupon GRPN online marketplace,
and fuel cell manufacturer Power Plug,

The biggest problem facing the market is that the Federal Reserve will continue to tighten until it sees signs that inflation is being controlled, and there is no indication that it will be soon.

The only asset that benefits is the US dollar DXY,
+ 0.06%,
trading around two-decade highs, while GC00 gold,
+ 0.11%
maintains its own riskiest assets, such as bitcoin BTCUSD,
+ 1.33%
sell off.

“There is a potential catalyst this week, which could slow market sales: U.S. inflation data for sale on Wednesday. Consumer price index is expected to fall to 8.1% in the first quarter. “April from 8.5% printed a month earlier. A softer inflation is the only thing that could give investors hope,” said Ipek Ozkardeskaya, a senior analyst at Swissquote Bank.

President Joe Biden is due to deliver a speech at 11:30 a.m. Eastern Day describing his administration’s attempts to reduce inflation.

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