Traders work on the floor of the New York Stock Exchange.
NYSE
U.S. stock index futures advanced during overnight trading after the main averages ended Tuesday’s session in the red.
Futures contracts tied to the Dow Jones industrial average gained 27 points. S&P 500 futures rose 0.1%, while Nasdaq 100 futures rose 0.16%.
The main averages withdrew from the record highs to close in negative territory during regular trading. The Dow slipped 97 points, or 0.3%, breaking a two-day winning streak. The S&P hit a record high, but retreated during the afternoon trading and eventually closed 0.1% lower during its first negative session in four. The Nasdaq Composite fell 0.05%, also achieving a three-day winning streak.
“There are many reasons to be excited about the coming months and overall we are optimistic for this year,” said Lindsey Bell, chief investment strategist at Ally Invest. “The momentum of equities is strong, no doubt. But the market may be ready to take a breather for investors to digest all the good news, determine the price and weigh against uncertain risks like inflation.” , added. .
Strong economic data, including March’s job report, which exceeded expectations, have fueled the rise in stocks in recent sessions. The top three averages reach their fourth consecutive quarter of earnings as Covid-19’s economic recovery accelerates.
The International Monetary Fund on Tuesday raised its growth prospects for the world economy for 2021 to 6%, compared to the January forecast of 5.5%. The organization said that “a way out of this economic and health crisis is increasingly visible.” However, the IMF warned of “daunting challenges” given the varied pace of vaccine deployment around the world.
“From a positioning standpoint, we still consider stocks to be attractive on a relative basis,” noted Keith Lerner, Truist’s chief market strategist. “While we expect periodic declines, US equities have risen 85% over time during economic expansions and valuations remain attractive relative to fixed income.”
Rising yields have frightened investors recently, causing a rotation out of growth and into value-oriented market areas. On Tuesday, the ten-year Treasury yield fell 7 basis points to 1.65%.
The Federal Open Market Committee will publish the minutes of the March meeting on Wednesday, where the central bank chose to leave interest rates unchanged. The minutes could provide investors with a clue as to when the Fed could raise interest rates.