U.S. stock futures look for direction after records for S&P 500, Nasdaq

U.S. stock-index futures saw mixed trade Tuesday as investors sifted through a slew of high-profile corporate earnings reports, including results from four Dow components, a day after the S&P 500 and Nasdaq Composite scored another round of all-time highs.

What are major benchmarks doing?
  • Futures on the Dow Jones Industrial Average

    rose 60 points, or 0.2%, to 30,928.

  • S&P 500 futures

    was up 2.85 points, or 0.1%, at 3,851.25.

  • Nasdaq-100 futures

    were down 12.75 points, or 0.1%, at 13,462.75.

The Dow

fell 0.1% Monday for its third straight daily decline, while the S&P 500
up 0.4%, and the Nasdaq Composite
up 0.7%, ended at records.

What’s driving the market?

Investors are wading through the busiest week of earnings reporting season, with Tuesday bringing a number of results from corporate heavyweights ahead of the opening bell, including Dow components 3M Co.
Johnson & Johnson
Verizon Communications Inc.

and American Express Co.

Revenue growth was likely to remain the “primary factor” when weighing results as investors cope with an environment marked by historically low bond yields and an economy constrained by deflationary factors, said Boris Schlossberg, managing director at BK Asset Management, in a note.

“A bevy of upside forecasts from management could help propel the indices to new all time highs. However if the general message suggests slowdowns ahead, the markets which are already trading at historically high valuations will be ripe for a correction,” he said, in a note.

In a closely followed example of potential market froth, shares of videogame-retailer GameStop Corp.

rose 15% in premarket trade, on track to add to a 300% gain so far this month which is attributed to a short squeeze amplified by a surge in options activity by individual investors.

See: As day traders make wild options bets in the stock market, some fear history is repeating itself

Investors continue to track negotiations around President Joe Biden’s push for $1.9 trillion in additional COVID-19 aid spending, which faces tough talks in a narrowly divided Senate as an impeachment trial for former President Donald Trump looms. Senate majority leader Chuck Schumer said Monday that his goal is to pass the next round of coronavirus aid by mid-March when jobless benefits from the December package expire. President Joe Biden said talks may revamp the $1.9 trillion plan.  

Biden on Monday also appeared to boost his goal for COVID-19 vaccinations in his first 100 days in office, suggesting that the nation could soon be vaccinating 1.5 million people a day, on average.

Moderna Inc.

on Tuesday said it was on track to deliver 100 million doses of its COVID-19 vaccine to the U.S. government by the end of March and to deliver 200 million doses by the end of June. The Cambridge, Mass.-based biotech said it has already delivered more than 30 million doses of the vaccine to the U.S. government. Moderna shares were down 1% in premarket trade.

About 10.1 million doses of the vaccine have by now been administered in the U.S., the company said, citing Centers for Disease Control and Prevention data.

The Federal Reserve on Tuesday kicks off a two-day policy meeting, its first of 2021. Policy makers are not expected to make any changes to policy, but are seen as likely to push back against ideas the central bank would be quick to begin easing up on asset purchases.

See: Think higher inflation is coming? The Fed will believe it when it sees it

The International Monetary Fund on Tuesday raised its forecast for global economic growth in 2021 but warned that there was still “extraordinary uncertainty” about the outlook.

The U.S. economic calendar on Tuesday features a pair of November readings on house prices at 9 a.m. Eastern — the FHFA house price index and the S&P Case-Shiller home price index.

A January reading of a consumer confidence index is due at 10 a.m.

Which companies are in focus?
  • 3M Co. shares edged higher in premarket trade after the diversified industrial manufacturer and Post-it maker delivered better-than-expected fourth-quarter earnings.

  • Shares of drugmaker Johnson & Johnson were higher after reporting stronger-than-expected earnings and revenue and delivering an upbeat 2021 outlook.

  • Verizon shares fell in premarket action despite fourth-quarter results that exceeded analyst expectations.

  • American Express shares were lower ahead of the opening bell after the company reported earnings and revenue fell in the fourth quarter from a year ago while logging a negative provision for credit losses

  • Outside the Dow, shares of General Electric Co. GE rose in premarket trade after the diversified industrial conglomerate reported a fourth-quarter profit that missed expectations but revenue and free cash flow that beat forecasts.

  • Raytheon Technologies Corp.

    shares rose more than 2% after the aerospace and defense company reported fourth-quarter profit and revenue that beat expectations, while providing a mixed first-quarter outlook.

  • Shares of private-equity giant Apollo Global Management Inc.

    rose more than 4% after the company late Monday said Leon Black would step down as chief executive after an independent review showed larger-than-expected payments to disgraced financier Jeffrey Epstein that were nevertheless deemed to have been justified.

What are other markets doing?
  • The yield on the 10-year Treasury note

    was up 0.9 basis point at 1.047%. Yields and bond prices move in opposite directions.

  • The ICE U.S. Dollar Index
    a measure of the U.S. currency against a basket of six major rivals, fell 0.1%.

  • The pan-European Stoxx 600 stock index

    rose 1.1%, while London’s FTSE 100

    gained 1%.

  • Stocks fell in Asia, with the Shanghai Composite

    down 1.5%, Hong Kong’s Hang Seng Index

    dropped 2.5% and Japan’s Nikkei 225 index

    shed 1%.

  • Oil futures edged higher, with the U.S. benchmark

    up 0.8% near $53.20 a barrel, while gold futures

    edged down 0.1%.

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