Futures U.S. stocks advanced Wednesday ahead of U.S. inflation data, suggesting key indices will resume this month’s recovery.
Futures tied to the S&P 500 rose 0.4%, while futures Dow Jones Industrial Average gained 0.3%. Contracts on the Nasdaq-100, a very heavy technology, advanced 0.5%. Both the S&P 500 and the Dow closed lower on Tuesday after hitting record highs earlier in the week.
Shares have risen this month, with the benchmark S&P 500 reaching its eighth record of the year on Monday. Investors are betting that President Biden’s $ 1.9 trillion stimulus package will help strengthen the economy, while vaccines will help reduce the death toll from Covid-19. Investor sentiment has also been bolstered by quarterly results from companies that have proven to be vastly better than expected.
“As earnings estimates increase, stocks increase,” said Andrew Slimmon, managing director and portfolio manager at Morgan Stanley Investment Management. “The magnitude of the profit rates we’ve seen is so great because the profits have been greatly underestimated.”
In off-hours trading, the firm Lyft rose 12% after recording a narrower annual loss, suggesting the company is moving towards profitability. Twitter rose 3.5% after the social media company said it added users during the holiday period. Cisco Systems fell 5.4% after saying second-quarter tax revenue and earnings declined.