Tuesday October 6th

6-10-2020

U.S. stock futures are little changed after Monday’s rally

U.S. stock index futures were little changed early Tuesday after the market had its strongest session in several weeks a day earlier. Futures tied to the Dow Jones Industrial Average added 9 points. The move indicated basically a flat open. S&P 500 futures lost 0.15% and Nasdaq-100 futures fell 0.3%. Traders were also waiting on a speech from Federal Reserve Chairman Jerome Powell, who is expected to tell the National Association of Business Economists on Tuesday that a new stimulus is needed to keep the economic recovery from stalling. Stocks soared in Monday session as investors grew more optimistic about President Donald Trump’s health and the possibility of additional economic relief. The Nasdaq Composite led the way with a 2.3% climb, while the S&P 500 and Dow jumped 1.8% and 1.7%, respectively. That marked the best performances for the Nasdaq and S&P 500 since Sept. 9 and the best day for the Dow since July 14. Trump left Walter Reed National Military Medical Center on Monday night, though White House physician Dr. Sean Conley acknowledged earlier in the day that Trump “may not entirely be out of the woods yet.” Meanwhile, House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin spoke for an hour on Monday regarding another stimulus package but did not reach an agreement. Pelosi’s spokesman Drew Hammill said in a tweet that the two planned to speak again on Tuesday. The rally on Monday was broad, with the Russell 2000 gaining 2.8% for the small-cap index’s sixth positive session in seven. Chris Ailman, the chief investment officer for CalSTRS, said on CNBC’s “Closing Bell” that the participation of smaller stocks was a good sign for markets. “Personally, I think I’m pretty concerned about the risks in front of us, the fact that the market is so top-heavy in the famous five stocks. But it was good to see the small caps do well today. I think that’s healthier for the market,” Ailman said. “We need a stimulus. The bottom line is this is a health crisis, and the health crisis is far from over.” Investors will get another look at the job market recovery on Tuesday morning when the Labor Department releases its Job Openings and Labor Turnover Survey at 10 a.m. ET. The reading comes after Friday’s jobs report for September showed weaker-than-expected labor market growth. Stocks in Asia-Pacific were higher on Tuesday as the Reserve Bank of Australia (RBA) kept its current policy settings on hold. Hong Kong’s Hang Seng index advanced 0.9% on the day to 23,980.65. In Japan, the Nikkei 225 rose 0.52% to close at 23,433.73. The Topix index also gained 0.52% to end its trading day at 1,645.75. South Korea’s Kospi advanced 0.34% to close at 2,365.90. Markets in China were closed on Tuesday for a holiday. Oil prices gained on Tuesday amid supply disruptions in Norway, a new hurricane in the Gulf of Mexico, and U.S. President Donald Trump’s return to the White House after being treated for COVID-19 in hospital. Brent crude futures were up 82 cents, or 2%, at $42.11 per barrel. West Texas Intermediate crude futures were trading 82 cents higher, or 2%, at $40.06. Gold edged higher on Tuesday as the dollar weakened, though gains were capped by improved appetite for riskier assets after U.S. President Donald Trump left the hospital where he was treated for COVID-19. Spot gold rose 0.3% to $1,917.86 an ounce, having hit its highest in almost two weeks on Monday at $1,918.36. U.S. gold futures gained 0.2% to $1,923.90.