U.S. stocks were indicated firmly higher early Tuesday, putting equity indexes on track for another session of gains, as the Federal Reserve is set to kick off its two-day policy meeting and as investors await a product debut for Apple Inc., as well as a fresh round of economic reports.
How are equity benchmarks performing?
Futures for the Dow Jones Industrial Average
advanced 111.50 points, or 1%, to 11,378.25.
On Monday, the Dow
rose 327.69 points, or 1.2%, to finish at 27,993.33, after briefly trading above the 28,000 threshold. The S&P 500
added 42.57 points, or 1.3%, closing at 3,383.54. The Nasdaq Composite
climbed 203.11 points, or 1.7%, to end at 11,056.65, snapping a two-session losing streak.
The Russell 2000 index
of small-capitalization stocks rose 39.70 points, or 2.7%, to end at 1,536.97, outperforming the major stock benchmarks.
What’s driving the market?
Stocks looked likely to climb early Tuesday helped by positive economic data from China where retail sales grew in August for the first time in 2020, up by 0.5% year-over-year last month, according to China’s National Bureau of Statistics.
Investors were heartened Monday by positive news on a vaccine against COVID-19 from AstraZeneca
as well as by merger news involving Nvidia
and will watch Tuesday for a product launch by Apple Inc.
as well as several IPOs.
The Federal Reserve is slated to start its policy-setting meeting later today, followed by a news conference and fresh statement from its officials on Wednesday, while central-bank decisions from the Bank of England and the Bank of Japan follow on Thursday.
“Global markets are focused on the two-day Fed meeting which will start on Tuesday, markets are modestly positive as investors anticipate a dovish outcome,” wrote Mihir Kapadia, the CEO of Sun Global Investments, in a Tuesday note. The meeting of the policy-setting Federal Open Market Committee also would be the first since the central bank introduced its new policy framework of average-inflation targeting.
“Although other factors across the continent have helped with this positive momentum, the overwhelming factor which is guiding the markets is the Fed,” wrote Kapadia. “Investors will be looking for signs as to what the U.S. growth and inflation outlook looks like and the possible responses from the Fed,” he said.
Investors are also watching for Snowflake Inc., a cloud-computing company, which is set to list on the New York Stock Exchange later today and has the backing of Warren Buffett’s Berkshire Hathaway
On Monday, Snowflake raised the proposed price range for its initial public offering to $100 to $110, up from a prior $75 to $85. The company is planning to offer 28 million shares to raise up to $3.08 billion
Separately, Apple Inc.
will hold its first virtual-only product reveal at 1 p.m. Eastern Time, where the Cupertino, Calif., tech behemoth is expected to show off its latest smartwatch and iPads, a debut which may provide a fresh catalyst for shares of the popular company.
Looking ahead Thursday, investors are awaiting a report on manufacturing activity in the New York Area, the Empire State Manufacturing Index as well as a reading of import and export prices, both due at 8:30 a.m. Eastern Time. A report on industrial production for August is due at 9:15 a.m.