Stocks are likely to move to the upside in early trading on Tuesday, extending the advance seen over the course of the previous session. The major index futures are currently pointing to a higher open for the markets, with the Dow futures jumping by 289 points.
Easing concerns about turmoil in the financial sector may lead to continued strength on Wall Street following recent steps taken to rescue distressed banks in the U.S. and Europe.
Positive sentiment may also be generated in reaction to remarks by Treasury Secretary Janet Yellen, who said the government is prepared to once again take action to protect bank depositors if smaller lenders are threatened.
In remarks prepared for a speech to the American Bankers Association, Yellen addressed recent steps taken to protect depositors following the failures of Silicon Valley Bank and Signature Bank.
“The steps we took were not focused on aiding specific banks or classes of banks. Our intervention was necessary to protect the broader U.S. banking system,” Yellen said.
She continued, “And similar actions could be warranted if smaller institutions suffer deposit runs that pose the risk of contagion.”
However, some traders may stick to the sidelines ahead of the Federal Reserve’s highly anticipated monetary policy announcement on Wednesday.
While the recent banking turmoil led to some speculation the Fed may leave interest rates unchanged, CME Group’s FedWatch Tool is currently indicating an 81.9 percent chance of a 25 basis point rate hike.
Shortly after the start of trading, The National Association of Realtors is scheduled to release its report on existing home sales in the month of February. Existing home sales are expected to increase to an annual rate of 4.17 million in February from 4.0 million in January.
Following the sharp pullback seen last Friday, stocks fluctuated over the course of the trading session on Monday but largely maintained a positive bias.
The major averages all finished the day in positive territory. The Dow jumped 382.60 points or 1.2 percent to 32,244.58, the Nasdaq rose 45.02 points or 0.4 percent to 11,675.54 and the S&P 500 advanced 34.93 points or 0.9 percent to 3,951.57.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher on Tuesday, with the Japanese markets closed for a holiday. China’s Shanghai Composite Index climbed by 0.6 percent, while Hong Kong’s Hang Seng Index surged by 1.4 percent.
The major European markets have also shown strong moves to the upside on the day. While the U.K.’s FTSE 100 Index has shot up by 1.6 percent, the French CAC 40 Index and the German DAX Index are both by 1.7 percent.
In commodities trading, crude oil futures are jumping $1.03 to $68.67 a barrel after advancing $0.90 to $67.64 a barrel on Monday. Meanwhile, after rising $9.30 to $1,982.80 an ounce in the previous session, gold futures are falling $16 to $1,966.80 an ounce.
On the currency front, the U.S. dollar is trading at 132.02 yen compared to the 131.32 yen it fetched at the close of New York trading on Monday. Against the euro, the dollar is valued at $1.0779 compared to yesterday’s $1.0721.
Business News
U.S. Stocks May See Further Upside In Early Trading
2023-03-21 12:51:39
