U.S. Stocks Likely To See Further Upside In Early Trading
Following the strong upward move seen over the two previous sessions, stocks are likely to see continued strength in early trading on Tuesday. The major index futures are currently pointing to a higher open for the markets, with the Dow futures up by 386 points.
Stocks may continue to benefit from optimism that the U.S. is seeing “the light at the end of the tunnel” of the coronavirus pandemic.
A number of states such as George, South Carolina and Colorado have already stated reopening, while other states like New York have announced plans to begin reopening in the coming weeks.
President Donald Trump’s administration has also unveiled a plan to ramp up testing, which experts have said is the most important step toward reopening the economy.
Documents from the administration suggest the federal government’s response to the need for more testing is largely complete and claim the states are mostly responsible for developing testing plans and rapid response programs.
The documents say the federal government will support state efforts to accelerate testing plans and programs but will only act as “supplier of last resort.”
The Trump administration’s plan, unveiled on Monday, is likely to frustrate some state leaders, who have called on the federal government to be more involved in testing.
The upward momentum on Wall Street also comes as traders digest the latest earnings news, with big-name companies such as 3M (MMM), Pfizer (PFE), and PepsiCo (PEP) reporting better than expected quarterly results.
Shortly after the start of trading, the Conference Board is due to release its report on consumer confidence in the month of April. The consumer confidence index is expected to tumble to 95.0 in April after slumping to 120.0 in March.
Stocks moved sharply higher over the course of the trading day on Monday, extending the upward move seen last Friday. With the advance on the day, the Nasdaq and the S&P 500 reached their best closing levels in well over a month.
The major averages pulled back off their best levels going into the close but remained firmly positive. The Dow jumped 358.51 points or 1.5 percent to 24,133.78, the Nasdaq advanced 95.64 points or 1.1 percent to 8,730.16 and the S&P 500 surged up 41.74 points or 1.5 percent to 2,878.48.
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Tuesday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while Hong Kong’s Hang Seng Index jumped by 1.2 percent.
Meanwhile, the major European markets have all moved to the upside on the day. While the German DAX Index has surged up by 1.8 percent, the U.K.’s FTSE 100 Index and the French CAC 40 Index are both up by 1.9 percent.
In commodities trading, crude oil futures are tumbling $1.12 to $11.66 a barrel after plummeting $4.16 to $12.78 a barrel on Monday. Meanwhile, after slumping $11.80 to $1,723.80 an ounce in the previous session, gold futures are rising $2.20 to $1,726 an ounce.
On the currency front, the U.S. dollar is trading at 106.58 yen compared to the 107.25 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0883 compared to yesterday’s $1.0829.
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