Having missed out on yesterday’s bumper day for stock markets, US indices have some catching up to do today.
Having closed on Friday at 31,458, the Dow Jones Industrial Average is expected to open around 200 points higher today.
The S&P 500 is tipped to rise 23 points to 3,957 and the Nasdaq 100 is on course to open 74 points better at 13,882.
“The ‘risk-on’ mood continues as equity indices around the world move further into record territory thanks to optimism on the vaccine rollout and the increasing likelihood that the US will pass President Biden’s full US$1.9tn stimulus package,” noted Marshall Gittler at BDSwiss.
There’s not much macroeconomic news in the US today so traders will get the chance to ease back into the old routine while keeping half an eye on the blast of cold weather stateside that has seen electricity prices head higher.
“The data calendar is bare in the United States today, where the big chill will probably knock stimulus-watch off the front pages. Nevertheless, Wall Street should come into the office remotely in full stimulus and vaccine-led recovery mode. Keep buying everything,” was the advice of Oanda’s Jeffrey Halley.
On the coronavirus front, 55,000 cases were reported in the US yesterday, down 29% from Monday last week, although severe weather depressed testing activity.
“The number of tests fell 21% from Monday last week but, encouragingly, the proportion of positive tests fell to 4.9% from 5.4% over the same period,” reported Ian Shepherdson at Pantheon Macroeconomics.
“Test positivity usually rises when testing is depressed by events like holidays or severe weather because people seeking precautionary tests are more likely to wait. Taking a longer view, the positivity rate has fallen by more than half since its early January peak, even though the seven-day average number of tests has fallen by 23%.
“The seven-day average number of confirmed cases has now dropped by 65% from the peak, on January 11, and the rate of decline is steady at about 22% per week. A combination of tightened restrictions late last year, immunity from prior infection and a rising vaccination rate—18% of adults have now had at least one shot—is crushing the original Covid variant,” Shepherdson said.
Four things to watch for on Tuesday:
- Some key names in the earnings diary today include pharmacy chain CBS Health Corp (NYSE:CVS), insurance corporation American International Group Inc (NYSE:AIG) and cloud communications firm RingCentral Inc (NYSE:RNG)
- Shares in software firm Palantir Technologies Inc (NYSE:PLTR) will also be eyed after the company reported a surprise loss in its results before the opening bell, although revenues did come in ahead of forecasts
- On the macro front, the New York Empire State manufacturing index for February may draw a few eyeballs, as well as a speech this afternoon from Fed board member Michelle Bowman
- Bitcoin is also likely to be in focus after the cryptocurrency hit another milestone by surpassing US$50,000 in value earlier on Tuesday
Story by ProactiveInvestors
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