U.S. stock futures pointed to a slightly firmer start for Wall Street on Tuesday, as investors hoped for a third-straight session of wins backed by optimism over trade talks.
How are major indexes trading?
Dow Jones Industrial Average futures YMH9, +0.51% rose 109 points, or 0.5%, to 23,618, while S&P 500 futures ESH9, +0.49% gained 11.4 points, or 0.5%, to 2,562. Nasdaq-100 futures NQH9, +0.51% gained 29 points, or 0.5%, to 6,526.50.
On Monday, the Dow Jones Industrial Average DJIA, +0.42% rose 98.19 points, or 0.4%, to finish at 23,531.35, while the S&P 500 index SPX, +0.70% advanced 0.7%, and to 2,549.69. The Nasdaq Composite Index COMP, +1.26% jumped 84.61 points, or 1.3%, to 6,823.47.
Another gain Tuesday would mark the third-straight win for stocks. On Friday, the Dow jumped 3.3%, the S&P 500 index rose 3.4% and the Nasdaq soared 4.3%.
What’s driving the market?
Optimism on the trade front continued to nudge investors toward perceived riskier assets such as stocks. Face-to-face negotiations between U.S. and China officials were entering a second day on Tuesday, with hopes rising that talks will bear fruit after President Xi Jinping’s top policy aide Chinese Vice Premier Liu He made an appearance on Monday.
Meanwhile, the world’s biggest smartphone and chip maker cautioned over profits Tuesday, which comes a week after Apple Inc.’s own shock warning, which triggered global equity volatility. Citing “mounting macro uncertainties,” Samsung Electronics Co. 005930, -1.68% warned of a 29% drop in fourth-quarter operating profit, far worse than analysts were expecting.
With a partial government shutdown now on its 17th day, lots of attention expected to focus on a prime-time border-wall speech from President Donald Trump due Tuesday evening. Some government employees will miss their first paycheck as a result of an impasse between Trump and Democratic lawmakers over funding for a proposed wall between the U.S. southern border and Mexico.
What are strategists saying?
“The key catalyst here is the U.S.-China trade talks and investors are hoping for some kind of progress that will allow equities to recover, while the recent downbeat tone coming from the Fed is also helping things amid expectations for fewer rate hikes,” said Konstantinos Anthis, head of research at ADSS, in a note to clients.
“However, investors will now start focusing on U.S. earnings’ season and it will be key to see whether corporate results continue to slow down, further dampening risk sentiment,” he added.
How are other markets trading?
Asian markets finished mixed, with South Korea’s KOSPI Composite Index SEU, -0.58% lower on Samsung’s warning, while Japan’s Nikkei 225 index NIK, +0.82% rose. In Europe, stocks were pointing to a slightly upbeat start.
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