U.S. stock futures rose before the bell on Tuesday as investors welcomed a rebound from higher oil prices and returned focus to the ongoing debate over the economy and interest rates.
S&P 500 (ES=F) futures rose 0.4% and Nasdaq 100 (NQ=F) rose 0.5% as the tech giants began recouping some of their losses from the previous session. Dow Jones Industrial Average futures (YM=F) rose about 0.2%.
As Monday’s headwinds subside, stocks should resume the winning trend of recent months. Oil prices are falling as tensions in the Middle East ease some, while the 10-year US Treasury yield (^TNX) briefly fell after rising above the key 4% level on Monday.
Some “Magnificent 7” stocks are starting to regain lost ground amid the negative headlines, with Amazon (AMZN), Apple (AAPL), and Alphabet (GOOG, GOOGL) all inching higher. Meanwhile, Nvidia (NVDA) closed the day with a profit as the chip giant’s partner Honghai cited “abnormal” AI demand.
But markets are still grappling with hopes for a big interest rate cut being dashed, while persistent strong Concerns about economic recession intensified. Hong Kong stocks (^HSI) fell more than 9% as a torrid rally in Chinese stocks fueled by economic stimulus faded.
Read more: What Fed Rate Cuts Mean for Bank Accounts, CDs, Loans, and Credit Cards
On this topic, New York Fed President John Williams told the Financial Times that the Federal Reserve’s policies are “well positioned” to achieve a successful “soft landing” for the economy. Meanwhile, Federal Reserve President Adriana Kugler said data will continue to drive interest rate decisions.
Those comments have turned investors’ attention to Thursday’s CPI inflation report, which will examine why the Fed is changing its plans to keep rates at 0.25% in the future. It will be.
On the corporate front, PepsiCo (PEP) had a strong earnings season, posting an unexpected decline in quarterly sales and lowering its 2024 sales growth forecast. The snack and beverage giant’s stock fell premarket.